Account limitations can impact your ability to process payments, pay vendors, and access money for other business needs. Learn more about what they are, so you can help protect your business.
PayPal account limitations are temporary restrictions that prevent you from sending, receiving, or withdrawing money from your PayPal account. Limitations can be placed on your account if there is suspicion of fraud, if your account is non-compliant with PayPal's Acceptable Use Policy, or if your dispute rate is too high.
If your account has been limited, you'll get an email from PayPal explaining the reason for the limitation. Log in to your account and go to the Resolution Centre or click the bell icon at the top of your Dashboard for more information. This will tell you what to do to remove the limitation, if applicable.
There can be several reasons for an account limitation:
If PayPal believes someone is using your account without your knowledge, the account could be limited to protect you from fraudulent charges while PayPal investigates the suspicious transactions.
Similar steps may be taken if your debit or credit card issuer or bank notifies PayPal that someone has used your card or bank account without permission.
Limitations can also be placed on an account that has been found to be out of compliance with regulatory requirements. For example, if you receive donations, you're required to provide documents confirming you're a registered nonprofit organisation. PayPal may limit your account while you gather those documents or while working with you to satisfy any other regulatory requirements.
The same is true if you don't follow PayPal's Acceptable Use Policy — selling banned items, such as prescription drugs or guns, for example.
When there are many buyer claims and chargebacks your account may be reviewed. During this review process, you may experience an account limitation. Issues that can be reviewed include:
If you start to sell an entirely new type of product, specifically higher-end items like jewellery, your account may be limited while PayPal investigates the change. Additionally, a rapid increase in sales volume may trigger account limitations to ensure there is no risk of error or fraud.
The time it takes to have account limitations lifted varies depending on the issue. The fastest way to keep the process moving is to submit the requested information as quickly as you can. Once you have, PayPal will aim to get back to you within 3 days to let you know what to do next.
Here are the steps to take to remove the limitations:
Account limitations can impact your ability to conduct business, so you should do everything possible to stay compliant. Here are five ways to help avoid the most common reasons for limitations.
By following PayPal's Seller Protection requirements, you can help reduce the impact of financial losses from chargebacks and claims on eligible transactions. Seller Protection requirements include shipping to the address on the Transaction Details page, capturing proof of shipment and delivery, and ensuring an item is eligible for Seller Protection before you send it. (Limits apply.)
Don't sell items listed as prohibited in PayPal's Acceptable Use Policy, such as drugs, illegal items, firearms, or obscene materials.
Unauthorised transactions are any transactions made without the consent of the account holder. To avoid processing an unauthorised transaction:
Fraudsters will often seek to avoid paying for an item by claiming they didn't receive the item. Too many of these claims can make your account look high risk, leading to limitations. Avoid “Item Not Received” claims by:
Make sure your product listing has accurate written content, high-quality photos, and product dimensions, so that customers know exactly what they are buying. Also, give customers a way to reach out and ask questions about an item before they buy to eliminate misunderstandings. Reduce claims by:
For complete information about Account Limitations, visit our User Agreement.
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PayPal UK Ltd is authorised and regulated by the Financial Conduct Authority (FCA) as an electronic money institution under the Electronic Money Regulations 2011 for the issuance of electronic money (firm reference number 994790), in relation to its regulated consumer credit activities under the Financial Services and Markets Act 2000 (firm reference number 996405) and for the provision of Cryptocurrency services under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (firm reference number 1000741). Some of PayPal UK Ltd’s products including PayPal Pay in 3 and PayPal Working Capital are not regulated by the FCA. PayPal UK Ltd’s company number is 14741686 and its registered address is Whittaker House, Whittaker Avenue, Richmond-Upon-Thames, Surrey, United Kingdom, TW9 1EH.
The content of this article is provided for informational purposes only. You should always obtain independent business, tax, financial, and legal advice before making any business decision.
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