If you select "Credit Card" as a funding source with paypal it won't work

[SunnyD]

I discovered an interesting thing today. If you set up a "billing account" with a merchant and set it to use your credit card as your primary funding source, Paypal don't give a shit. They'll still pull from your bank account first never touch your credit card.

In the above screenshot, you can see after setting up with a merchant an explicitly selecting credit card as my funding source, paypal don't give a fuck. They play by their rules (normally Balance -> Bank -> CC).

I have a low balance checking account specifically for paypal, and thanks to their cockup I now have a negative balance and two overdraft fees. We'll see if paypal does anything about it after my phone call to them. They tried to tell me that my bank is the one responsible for the NSF fees - sorry guys, you're responsible for a system that doesn't work correctly.

 

[Mixolydian]

Never had this issue.

 

[edro]

Wow, that does suck. Paypal's "balance first" policy really pisses me off.
This example is another reason to hate them even more.

Good luck, but there is no way in hell they will reimburse you for NSF fees.

32kth post in a paypal hate thread.

 

[NikolaeVarius]

They've done this for a LONG ass time.

 

[ControlD]

Yeah, I ran into this problem as well although that was a few years ago. I did finally get it to automatically change over to a backup credit card if there are not sufficient funds in my (also limited) checking account. I had to work with my bank to get that working however, Paypal could never get it setup correctly. My bank is actually the institution that switches over to the credit card, not Paypal.

 

[DaWhim]

I guess you have a balance in paypal. empty it, then you can pay with credit card.

 

[edro]

I guess you have a balance in paypal. empty it, then you can pay with credit card.

It pulled from his checking, not his balance.

 

[Pulsar]

It pulled from his checking, not his balance.

And this is why linking your bank account to PayPal is just asking for trouble

 

[ControlD]

And this is why linking your bank account to PayPal is just asking for trouble

I just made a separate checking account for PayPal to get around those worries. I keep a small balance in there but it isn't liked to anything major.

 

[Aikouka]

We'll see if paypal does anything about it after my phone call to them. They tried to tell me that my bank is the one responsible for the NSF fees - sorry guys, you're responsible for a system that doesn't work correctly.

Chances are they won't. I called eBay/PayPal about an issue with UPS constantly telling me that my address is wrong for creating labels. The only way to fix it? Remove your UPS account and create a new one, which also removes your discount. The discount takes a few days to go back into place, and you can't hold a product for that long. eBay factors in your discount, which means YOU have to cover the extra shipping. Well, what about FedEx? It's impossible to print a FedEx label through the website unless you chose FedEx when creating the auction. Amusingly enough, the only way to switch from UPS to FedEx is to use the eBay app.

So, when I called up eBay to complain and see if there was anything I could do, they forwarded me to PayPal. Then PayPal said that's not what they handle and they forwarded me to eBay. eBay said that I'd need to talk to PayPal for a reimbursement, and they forwarded me to PayPal. PayPal then said that it was eBay's error, and I'd need to talk to eBay.

Honestly, it ended up being a waste of an hour. The only "answer" that I got out of the entire call was to do exactly what I did to fix the UPS error, and as for the difference in shipping costs? Suck it up, buttercup... or just never ship UPS.

 

[cronos]

For those of you who just skimmed through the explanation, note that this behavior is specifically related to a monthly subscription, also known as 'recurring payments' in Paypal. There is currently no way to make a recurring payment set to automatically charge from your credit card. It has to go through your Paypal balance (and to your checking account, if your balance is zero).

 

[John Connor]

Because your credit card isn't the primary funding source?

 

[SunnyD]

Nope. They're not going to do anything about it (initially), and I'm going to have to press the issue. How do I know? Despite politely requesting them to escalate a ticket to have this behavior fixed as well as to handle the issue of them screwing me over, I haven't received any emails about support tickets being filed which usually is the case whenever they actually take any sort of action.

Guess I'm going to have to be a little less polite this time.

 

[IronWing]

IIRC, PayPal always pulled from balance then bank account and then CC. I haven't reviewed the user agreement in years but it used to be spelled out that that was the order, period.

 

[CoPhotoGuy]

I think you just found out that you don't know how to use Paypal because I've always had it use my CC and not bank account and never had any issues.

 

[SunnyD]

IIRC, PayPal always pulled from balance then bank account and then CC. I haven't reviewed the user agreement in years but it used to be spelled out that that was the order, period.

Which is funny that they'd even give you an option to set your primary funding source as CC in any way, shape or form then, isn't it?

This is also absolutely not true, since I have often made purchases that have been directly billed to my CC if I had no balance in my paypal account without ever hitting my bank.

 

[edro]

Which is funny that they'd even give you an option to set your primary funding source as CC in any way, shape or form then, isn't it?

This is also absolutely not true, since I have often made purchases that have been directly billed to my CC if I had no balance in my paypal account without ever hitting my bank.

Right. So it sounds like it is only for recurring payments that the issue is occurring.

They don't want to take the credit card risk/fees on a recurring payment, but a one time purchase is ok.

 

[SunnyD]

Right. So it sounds like it is only for recurring payments that the issue is occurring.

They don't want to take the credit card risk/fees on a recurring payment, but a one time purchase is ok.

And yet they bury the option to change the settings after the fact for reoccurring payments within your account settings as well, on top of the fact that their order-time UI implies that you can and will set it up with your CC as the primary source. They use the exact same merchant interface for reoccurring payments as they do for one-time purchases. It's either poor design or on purpose to screw people over. Given paypal, I opt for the latter.

I'm not arguing anything that isn't already known here: Paypal will do anything to screw over the user.

 

[DaWhim]

It pulled from his checking, not his balance.

i use paypal to make hundreds of payment a month. there is something wrong with the merchant setup, that's why OP can't use CC. someone just mentioned it is recurring payment, that's probably right.

another reason could be merchant has a setup with paypal like hautelook (owned by nordstrom).

 

[RibeyeAndScotch]

Really wish Google wallet would replace paypal

 

[SunnyD]

i use paypal to make hundreds of payment a month. there is something wrong with the merchant setup, that's why OP can't use CC. someone just mentioned it is recurring payment, that's probably right.

another reason could be merchant has a setup with paypal like hautelook (owned by nordstrom).

Wrong.

This is a flaw in Paypal's interface. The is completely outside of the merchant, and is wholly within Paypal's garden. The only thing that the merchant has control over in this case is their API key. All the data that is passed through is entered via Paypal's own UI, and passed through within their own network.

 

[Muse]

Paypal always defaults to my checking account, but I always click "change funding source" and choose one of my registered credit cards.

 

[DaWhim]

Wrong.

This is a flaw in Paypal's interface. The is completely outside of the merchant, and is wholly within Paypal's garden. The only thing that the merchant has control over in this case is their API key. All the data that is passed through is entered via Paypal's own UI, and passed through within their own network.

I just log into paypal to see what it is actually called. It is called preapproved payment. this will make funding source to checking.

preapproved payment has its own API and some merchants choose this over than normal check out API.

 

[DaWhim]

well, it does looks like you are doing a preapproved payment. here is the link to paypal user agreement

https://cms.paypal.com/al/cgi-bin/?&cmd=_render-content&content_ID=ua/UserAgreement_full

look at clause 2.2, 2.3 and 2.6 for your reference.

2.2 Default Payment Methods. When you make a payment, if you have not selected a Preferred Payment Method, PayPal will fund your transaction in this order (subject to availability based on your Payment Methods and country of registration):
a. Balance

b. Instant Transfer from your bank account

c. Debit card

d. Credit card

e. eCheck

2.3 Preferred Payment Method. You may select a Preferred Payment Method each time you make a payment, except for a Preapproved Payment or a No Log-In Payment.

For a Preapproved Payment and, in most instances, a No Log-In Payment, you can select a Preferred Payment Method when you provide your initial authorization for this payment and through the My Preapproved Payments section of your Account Profile.

2.6 Preapproved Payments. A Preapproved Payment is a payment in which you Authorize a Merchant to directly charge your Account on a one-time, regular, or sporadic basis. Preapproved Payments are sometimes called "subscriptions", "recurring payments”, “preauthorized transfers” or "automatic payments".

 

[SunnyD]

Terms of service does not shield companies from misleading practices. Paypal most definitely knows this as of late.

2.3 is also contradictory in and of itself.