Why are my funds held in reserve in my PayPal account?
Reserves may be a necessity throughout a your relationship with PayPal. Preventing reserves isn’t always possible, and depending on your industry and your credit history, you might never be able to fully remove a reserve from your account.
However, you can reduce the likelihood of having a reserve and improve your customer service in the process by following Seller Best Practices – and that’s a win-win for everyone.
Seller Best Practices
Some best practices to follow are:
- Ship promptly and give your customers valid tracking information through PayPal, so they can keep tabs on their purchases and know when to expect delivery.
- Communicate early and often with your buyers and let them know about any changes, delays, or other important information.
- Monitor your buyer complaint rates regularly and try to keep complaint rates below 1% of your sales.
- Avoid long refund times, which can lead to complaints from unsatisfied customers.
PayPal proactively reviews reserves and based on improvements to your business performance. It's possible that your reserves could be adjusted or removed if you’ve made improvements in key areas, such as performance, industry, and claim reductions.
To see how much balance is in reserve, go to your Account Summary and view the "on hold" section under "PayPal balance." From time to time, we may need to adjust your reserve amount. If that happens, we’ll email you about the changes.