PSA: PayPal Personal Accounts, F/F Payments and Fees

[MooseDog]

PSA = Public Service Announcement

Am posting this for the benefit of those who many not have encountered this situation yet.

Seems that PayPal has added a "feature" to Personal Accounts (previously you could not take a credit card payment without converting to a "Business" account) whereby you can now do so but it triggers fees. In the past I could take payment to this account, but if someone used a credit card to fund the payment I got a message saying that if I wanted to claim the money I had to convert to a Business account. I never did convert this account, but one day I got a payment from someone and fees had been deducted.

But it appears that now any transaction that appears to be for good and services is now flagged and fees are charged. One trigger seems to be the Notes field, and now they've added a layer to the payment process that defaults to Goods and Services.

It happened again and I found the common thread was that each person had put their address in the "Notes" field on PayPal.

Then recently another sent a payment and said that the F/F option wasn't available. Again, fees were charged against the payment. Interestingly, no Sales Tax was recorded (the other party and I both live in an "internet Tax" state).

So I checked my account info and the option to "Upgrade to a Business Account" is still there and I don't have the bells and whistles available to my separate "Business" account. Then, I started a payment process and I noticed that they had changed the process and added a screen whereby you can specify "Sending to a Friend" or "Goods and Services". In place there is a default option which of course is "Goods and Services". If you just click through fast like you used to you're probably going to miss this.

I'm going to go back and actually read the "We've changed the terms of services" emails but I'm sure they changed the game at some point.

So when you reach this screen when sending a payment via F/F to someone, be sure to do two things:

1) Leave the Notes field completely blank
2) Click on the Change option and then select "Sending to a Friend"

EDIT: I also see you can generate shipping labels in this Personal Account. I would hesitate to do that on a F/F payment as I'm pretty sure that would get flagged as well, but have not tried this as yet.