https://www.planetofthevapes.co.uk/...yment-guidance-being-given-to-businesses.html
Posted 1st December 2020 by Dave Cross
The number of businesses impacted by the PayPal crackdown has continued to grow since we first warned of the situation in mid-November. As the volume of frozen accounts escalated, we advised companies to draw down funds or risk them being locked away. Now one of the industry’s trade bodies has issued clear guidance for businesses as yet unaffected.
Our article dated 16 November can be read here [link].
Initially, some sources told Planet of the Vapes that PayPal had said the issue was to do with intermediary payment processors not understanding its policies and there would not be an industry-wide problem. Other sources said PayPal had informed them it was only going after bad actors, especially those who may be selling CBD products.
It became clear from reports business members in the vendor section of the forum [link] were giving that neither of these reasons appeared to be the case. It seemed as though PayPal was downplaying the situation in a clear attempt to delay account owners from drawing down funds so that it would have cash on hand to meet any refund claim during the 180-day period following the freezing, prior to account closure.
Vendors on the forum have been sharing advice with each other for a couple of weeks. On Friday, the Independent British Vape Trade Association (IBVTA) issued advice to its members.
IBVTA says: “The UK’s vaping industry is regulated by Government and recognised as legitimate. Vaping products are recognised in the UK as a positive influence on public health and utilised in NHS, local authority and other health settings.
“With the continuation of restrictions due to Coronavirus, businesses who sell online need to have their websites operating with minimal downtime and disruption due to issues such as their payment transaction gateway.
“While the IBVTA are working to establish dialogue with PayPal on their approach to our sector, and the implications of their actions, there are practical steps vaping businesses can take to mitigate the impact on their business.”
The trade body has issued the following advice to businesses:
Related:
Posted 1st December 2020 by Dave Cross
The number of businesses impacted by the PayPal crackdown has continued to grow since we first warned of the situation in mid-November. As the volume of frozen accounts escalated, we advised companies to draw down funds or risk them being locked away. Now one of the industry’s trade bodies has issued clear guidance for businesses as yet unaffected.
Our article dated 16 November can be read here [link].
Initially, some sources told Planet of the Vapes that PayPal had said the issue was to do with intermediary payment processors not understanding its policies and there would not be an industry-wide problem. Other sources said PayPal had informed them it was only going after bad actors, especially those who may be selling CBD products.
It became clear from reports business members in the vendor section of the forum [link] were giving that neither of these reasons appeared to be the case. It seemed as though PayPal was downplaying the situation in a clear attempt to delay account owners from drawing down funds so that it would have cash on hand to meet any refund claim during the 180-day period following the freezing, prior to account closure.
Vendors on the forum have been sharing advice with each other for a couple of weeks. On Friday, the Independent British Vape Trade Association (IBVTA) issued advice to its members.
IBVTA says: “The UK’s vaping industry is regulated by Government and recognised as legitimate. Vaping products are recognised in the UK as a positive influence on public health and utilised in NHS, local authority and other health settings.
“With the continuation of restrictions due to Coronavirus, businesses who sell online need to have their websites operating with minimal downtime and disruption due to issues such as their payment transaction gateway.
“While the IBVTA are working to establish dialogue with PayPal on their approach to our sector, and the implications of their actions, there are practical steps vaping businesses can take to mitigate the impact on their business.”
The trade body has issued the following advice to businesses:
- If their PayPal account is active, consider withdrawing the funds to their bank account, to minimise any potential future impact on their business.
- If PayPal have frozen the funds in their account, to make sure that they follow their instructions to complete the information they ask from them.
- If PayPal have frozen their account and they have contacted them to appeal for the release of their funds, keep a record of communication with them – what they sent and when.
- If they have contacted PayPal to appeal for the release of their funds and they have not responded after 8 weeks, they can report this to the Financial Service Ombudsman for Small Businesses by making a complaint. Bringing a complaint to the Financial Service Ombudsman is straightforward and won’t cost anything. See here for more information, and how to make a complaint.
- Look into alternative transaction gateway providers, making sure to carefully read all terms and conditions, and consider if the payment gateway is compatible with their e-commerce platform, e.g. Shopify, etc.
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