If you receive payments via PayPal through your e-commerce platform, it's worth being familiar with the payment statuses you may see within your PayPal account.
Whilst no web orders will download to Cloud POS if the customer has not made a successful payment, we strongly suggest that you check each order in POS against the payment method used, before you process it in POS. This allows you to run a human eye over the activity taking place in your account and be alert to any issues that might warrant further investigation.
Where this can be particularly relevant, in regards to PayPal, is when PayPal may elect to put a payment on hold. This means that the payment will be held in your account for a period of time, until PayPal are satisfied there are no issues with the transaction or your PayPal account. The payment will be unavailable to use during this period.
The following information is PayPal's own guidance on why they may decide to do this:
- You’re a new seller with PayPal, or you’re an established seller but have opened a new account. It takes time to build up enough history of successful transactions.
- You haven’t sold in a while. Previously inactive accounts may be subject to payment holds while rebuilding a positive selling history.
- You receive a large number of reversals, disputes, or chargebacks. PayPal suggest that you communicate with your customers often and work with them to resolve any concerns. If your customer filed a dispute or chargeback because someone illegally used their PayPal account to make the transaction, please hold off on shipping any items.
- Your selling pattern has changed. For example, the sales volume increases abnormally, or there’s a change in your average selling price, business platform, or type of item being sold.
- The transaction involves higher-risk items, including tickets, gift cards, consumer electronics, computers, and travel packages.
PayPal will hold payments in order to ensure that there are enough funds in your account to resolve any issues that may arise with your account such as chargebacks or disputes. If no such issues are found, the payment will generally be released and available in your account within 21 days after receipt.
Another payment status which can be applied to transactions is Pending. PayPal payments in this state need to be accepted or claimed by you as the recipient, within 30 days of the payment being made. If you fail to claim the payment within this period, PayPal will automatically return the payment back to the customer.
The risk for you here as the retailer, is if you fulfil the customer's order, do not claim the payment within your PayPal account, and the payment is then returned to the customer.
You may also see a payment showing as Pending if the customer has paid by eCheck through PayPal. An eCheck is an electronic payment funded by the sender's bank account. It may take up to 6 business days for an eCheck to clear, so it is important that you do not provide any goods or services until the payment has been confirmed as available in your PayPal account.
With this in mind, we again reiterate the need to cross-reference your payment method accounts when processing web orders in POS, so that you can identify any payments that might be affected in this way.
