PayPal is unreliable, can't explain why my debit card was declined and can't fix it

  • Problem
  • Updated 2 years ago
I've had the PayPal Debit Card since December and used it as my primary funding source for nine months now. It is also worth noting that I am a person who pays for EVERYTHING with a card, so I used the PayPal Debit Card a lot, almost daily, since then. Not anymore. Starting this month, there have been some weird things going on with my account that PayPal cannot explain or fix. I am so frustrated with PayPal as a company that I am now trying to avoid their products and services as much as possible.

On 1 September, I tried to use my card to purchase some groceries and it was declined. The purchase was for a mere $31. Very flustered and confused, I paid with another card and left the store.

Call #1: Immediately after getting home, I called PayPal and 35 minutes later they answered the phone. I explained the problem and, after being put on hold for 15 more minutes, I was told my card was declined because I had set a backup funding limit of $23.15. I told the rep this couldn’t be true as I have never set such a limit. Also, the PayPal website won’t even allow you to set a limit that is not a multiple of $200 (I have tried to change the limit before and it appears as a dropdown menu on the website with multiples of $200). Also, I told her that I have used my card for amounts in excess of $23.15 countless times in the past nine months. The rep looked at my past transactions and agreed that I had charged more than this amount before; she couldn’t explain that. I asked her to remove the limit. She said she couldn't because I had set it up on my end. Lies again. There is nothing that PayPal, the owner of the card, cannot control. But, I played along and asked her for instructions on how to remove the limit myself. I was unfortunately out of time as I had been on the phone for over and hour now, so the rep emailed me the instructions to change the limit.

Later that day, I check my email and follow the instructions. The PayPal website shows me that the limit is $200, but I try to increase it anyway. It tells me that the limit cannot be changed while there are pending transactions. Alright, that’s fine. I put the card in a drawer and don’t use it to allow it to clear completely. Four days later, after everything in my account has changed from “Pending” to “Completed”, I try to change the limit again but get the same error.

Call #2: The next Sunday (9 September) when I have plenty of time on my hands, I call PayPal again. The rep picks up 25 minutes into the call I briefly explain the limit thing and tell her that I would just like to increase my backup funding limit (as this is something I’ve wanted to do anyway but never got around to because I always had pending transactions, seeing how I used the card for all purchases). She walks me through it with me at my computer and I get the same error. She checks my account and confirms that nothing is pending. She would escalate this and someone from the next level of support would contact me via email or phone within 48 hours. I asked about why the transaction was declined, still not believing the $23.15 limit story, but she couldn’t tell me.

It’s now 13 September. I never received an email from PayPal. I also tried to change the backup funding limit a few more times, thinking that maybe I just needed to wait longer for some reason. All of the transactions had definitely cleared, but it still wasn’t letting me change the limit. Seeing as how I was having *so* much success with calling them, I decided I would email them. I sent two emails, one asking why my transaction was declined and one asking why I cannot change the backup funding limit.

Days pass again. On 16 September, I get two responses. One say that they are “aware of the problem with my account regarding the backup funding limit” and that they are “working on it”. Hmm, well, it’s been 15 days now. Maybe you could work faster or at least keep my informed throughout the process. The other email says “From researching your account history, I can see that your issue has been previously addressed.” Uhm, no it hasn’t. I immediately reply and say that something is wrong and inform her that the issue was never addressed. I am again in the position of waiting on PayPal’s response for both issues. On 19 September, I get a generic form email saying that there are “a number of reasons” why transactions might be declined and they mention things like paying at the pump for large amounts, insufficient funds, blah blah blah -- none of which apply. On 24 September, I get an email saying that their “technicians are still working” on the backup funding issue with my account and that I should try to “delete my bank account and read it” as a possible solution “in the mean time”.

So basically, my card is declined for no reason and 18 days later I still haven’t gotten a satisfactory explanation. The card is completely useless now, as I have no idea whether it will work or be declined the next time I try to use it. I don’t trust PayPal anymore as their service is nowhere near reliable. I can only say how glad I am to have discovered PayPal’s incompetence and lack of customer service now, before I had a real emergency or problem that needed to actually be 1) solved in a 2) timely manner and with 3) courtesy. PayPal misses the mark on all three of these.
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
  • frustrated

Posted 7 years ago

  • 15
Photo of Amy Muller

Amy Muller

  • 5 Posts
  • 1 Like
Wow, how frustrating and inexcusable!! Thanks for sharing your story. It's a good warning for anyone considering a PayPal debit card.
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
I followed the rep's suggestion and deleted my bank account and then re-entered it. I had to re-verify the account (which required waiting three days for the microdeposits to post). Now my bank account is back, but I cannot link it to my PayPal Debit Card. The only options under Backup Funding are "No backup funding" or "Apply for the PayPal Credit Card", neither of which I am interested in having. I feel like I've taken a step backwards.

Well, I will give them one thing: They took the surprise out -- since my PayPal balance is $0, my card will certainly be declined 100% of the time now.
Photo of Amy Muller

Amy Muller

  • 5 Posts
  • 1 Like
Sheesh. Well, it sounds like you've got the right attitude. They're obviously not going to fix it properly so no use stressing yourself out about it anymore. It's their loss of business.
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
So I remember now why I wanted to get this resolved: I occasionally shop at Sam's Club and they only accept MasterCard. I called PayPal again last night and spoke with someone about getting my debit card linked to my checking account like it used to be. The rep verified that the problem was indeed happening and that he couldn't override it. He said someone from the technical support team would be in touch with me within the next few days to apprise me of any updates.

I was very surprised to have received a reply when I awoke this morning. "Wow, they have improved," I thought. Then I read the email:
We had attempted to correct this issue with an update last week. Unfortunately, the issue was not able to be corrected.

We are aware of this issue and I sincerely regret the inconvenience it
has caused you. Our technicians are still working to resolve this
matter. We appreciate your patience and understanding.

If you have any further questions, please feel free to contact us again.

Ha! Pretty much "We couldn't fix it, so we're done with you." After my excellent customer service experience with Wells Fargo, I think I will be contacting them about getting a MasterCard.
Photo of Amy Muller

Amy Muller

  • 5 Posts
  • 1 Like
I guess at this point we shouldn't be surprised. Too bad there's such a lack of competence. Glad you're at least getting good service from Wells Fargo.
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
Hmm, so apparently neither my credit union nor Wells Fargo offer MasterCard, but I'm sure I can find another one someone. :-p
Photo of kristin

kristin

  • 1 Post
  • 2 Likes
Nick,

My name is Kristin and I work at PayPal. I was reading your post and it sounds like you have experienced several levels of frustration with our customer support. I do apologize for all the runaround you experienced and it looks like I have several takeaways to follow up on. Before I follow up with my counterparts internally I would like to take a look at your account and see what I can do to assist you. Could you please email me directly with the email address on your PayPal account and I will see what I can find out.

Here is my email address: paypalkristin@paypal.com

Thanks for your posting and I look forward to hearing from you.

Kristin
paypalkristin@paypal.com
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
In summation, Kristin from PayPal did contact me and she explained that best way to fix this problem was for PayPal to issue me a new debit card. As I began experiencing problems over three months ago, I have since moved on to other financial products and services and am no longer in need of or interested in the PayPal card. I requested that Kristin instead just cancel my existing (non-functional) debit card.

While it was not able to save me as a customer (I still have a PayPal account out of necessity for Internet payments), I am excited to see the beginning of successful interaction between consumers and companies at GetSatisfaction.com.
Photo of Eric Suesz

Eric Suesz

  • 14 Posts
  • 0 Likes
Well, I am sorry to hear that it didn't work out for you and PayPal. That is a severed relationship that sounds like it can't be healed, but I am glad to hear that you had a good experience here, and that this participation by PayPal might help others in the future.
Photo of

  • 1 Post
  • 0 Likes
I have been having the same problem the last two months.
Photo of Buck Sommerkamp

Buck Sommerkamp

  • 1 Post
  • 0 Likes
Wow...I found this site in a search for "paypal debit card declined backup funding" and it appears I'm not the only one having this EXACT problem. I have gotten so many different stories from Paypal, usually revolving around the whole idea of "resetting" your backup funding source. Like Nick, I can't do this because I had two transactions that actually WORKED properly...leaving the PayPal reps to the insane notion that I have "a backup funding limit of $6.89." Um, yeah. Have they checked their own web site to see that this isn't really possible (because of the $200 increments)?

My problem began about two months ago (May/June) and still hasn't been resolved. There is obviously something horribly wrong with the whole backup funding system, and none of the PayPal reps appear to understand that it is a huge problem for customers like me who use their PayPal debit card for recurring charges such as gym membership, NetFlix, etc. The best thing about the backup funding is that although you get an immediate notification to your email that something has been charged, you have a couple of days to make sure the funding is available in your bank account when it does the backup withdrawal. This has worked FLAWLESSLY for me for more than a year. Then, suddenly, I am having the exact problem Nick describes, in almost the exact same form.

Count me as a very frustrated customer, who has been with PayPal for 7 years now, and who hopes they eventually train their CSRs about backup funding and how it works (or doesn't).

On screen, my account shows that I have a $1,000 backup funding limit, linked to my bank account which is completely and perfectly active.

When a rep looks at it, they only see the "available" limit, which at the moment tonight is $6.89.

So as I told the latest/greatest rep..."there is something deeply, horribly wrong, way down in the bowels of the system, and NOBODY is detecting it."

I hope they can figure out where my extra $994 of backup funding has been hiding, because the credit card authorization system isn't seeing it!
Photo of quietmint

quietmint

  • 7 Posts
  • 1 Like
I'm sorry to hear other people are experiencing this same frustration.

The real reason I used the PayPal Debit Card was for the cashback rewards. I ended up signing up for a Capital One card and the rewards are pretty similar. I don't know if this is still available now, but I'm getting 1.25% cashback on all purchases with no annual fee, no limit on cashback, and no expiration. The real reason why I'm using the Capital One card, though, is because they credit your cashback monthly and you can redeem at any amount by going online and just clicking a button to redeem (and/or you can also set it up to automatically redeem during a certain month or a certain dollar amount). I haven't had any problems so far and I'm not really missing PayPal.
Photo of

  • 1 Post
  • 0 Likes
Hi kristin I need to talk to you my email is [personal data removed] i really have a big problem with paypal and thx.
Photo of Amy Muller

Amy Muller

  • 5 Posts
  • 1 Like
Hi there. I'm going to remove your email address so that it does not get used in any unwanted way. Everyone in this post should have received an email notification with your reply already so Kristin will have your email address. Also, you may want to try posting a new topic -- you will have better chance of getting attention on it that way.
Photo of starr-rhapsody

starr-rhapsody

  • 7 Posts
  • 0 Likes
I am getting the same runaround from PayPal customer service. Now their story seems to be the "backup funding is not guaranteed" and you can only use your PayPal Debit Card for the amount that you currently have in your PayPal account, which totally negates the purpose of having the automatic backup funding in the first place. I am disgusted and looking into other credit/debit card options that offer cash back rewards. The best thing about the PayPal card is that it is a debit card and it is very difficult to find a debit card which offers cash back.
Photo of

  • 11 Posts
  • 0 Likes
Hi folks.... I've been reading over this issue and, like many of you, I got here by Googling "PayPay Debit Card Declined." I, like many of you, have been having this problem for a VERY long time. I've been having it for a number of years as well. I don't want to sound insulting to anyone out here, because it sounds like there are some smart and knowledgeable people here. That said, I'm a pretty smart and analytical guy, with some experience in the banking and credit card industries. I'm currently an IT professional, and have been doing some of my own heavy research and experimenting iwth this problem to try and ascertain the real reason. I'll prface my findings with the statement that I could just get rid of this card and use something else, although like mahy of you, I do enjoy the cashback benefit. For me, it's become more of a matter of principle at this point-- I just want a straight answer; I don't like unanswered questions.

With all that siad, I'm going to share with you what I know. I also have a couple of questions for those of you who are having this same issue. Your answering my questions will GREATLY help me in completing my research into this. I am at this point exhaustively trying to chase down "real" people at eBay / PayPal. By that I mean people who are in positions of ability and authority that goes beyond the scope of that of the Customer Service Reps on the phone and their "supervisors" (who are usually just phone reps with more time on the floor.) Once I reach someone within management or perhaps IT, I am confident that I can find a real resolution to this for all of us, and won't stop until I do. Therefore, again, your feedback to my questions is very useful and important to that end.

My story isn't unlike most of yours, so I'll spare the boring details-- PayPal debit card w/ backup funding denied for no apparent reason. The interesting twist to mine that I haven't see here is that I actually have TWO PayPal debit cards. One is my primary card, and the other is a secondary card, tied to the same account, for my friend (whom we'll call Karen). There seems to be a "threshhold", that is, a "magic" (and quite arbitrary, it would seem from what all of you are saying) amount at which the primary card will decline. My card generally declines at around $150. When it declined, it used to then decline anything and EVERYTHING for about the next day. When I contact PayPal about this for about the past two years, I'd always get this lame answer that IIt's part of our security / fraud previention protocol." But, of course, they couldn't tell me what the parameters of that protocal are, therefore it's safe to assume that's a canned answer. I've gotten a host of other euqally useless and meaningless uninformed answers ranging from "The magnetic stripe on your card could be defective" (then why can you see the decline in your oline system?????) to "Your backup funding source has insufficient funds."

The reason I say that my situation is someone unique, having the second ard, is that the second card NEVER declines! I can, for example, go into BJ's Wholesale and swipe my card to buy a $250 pre-paid gas card (you didn't used to be able to use your PayPal card at the gas pump, now they seem to have removed that restriction... There's one point for PayPal.)... Anyway, my card would ALWAYS decline (and then subsequently decline everything for 24 hours.) I could swipe Karen's card though, and the transaction would go through. In my online activity, I'd only see the one that has been approved.

The closes thing I've gotten to a resolution that "MIGHT" have made sense was that they actually decided they couldn't tell WHAT was wrong with my card, so they issued me a new one-- Not just a new plate, a whole new MasterCard number in order to try and reset the account. Unfortunately, this hasn't worked. The same problem still exists, although Karen's still never declines. Incidentally, I've gotten the same answer from them before that some of you have gotten that "Your backup funding source isn't guaranteed", stating that I should have sufficient funds in my PayPal account to cover the transaction. I've never actually tired to pre-fund my account with some money, and then see if my card works. I have a hunch it won't, but admittedly, this is something to try

My personal theory, for anyone who's interested of a technical mind and might card to comment, is that I think that somehow each "user instance", if you will of the card (Karen and I are as such separate User Instances of the same parent account, each with a separate card / number) has a set of "flags" or values associated with it. This is already evident in the fact that you can separately set limits for each card on the account. I beleive that some of those flags or thershholds are there, but not visible to the user (and perhaps not to the PayPal customer servce reps). These threshholds may indeed be part of account security, and could possibly be set by various account activity events, including average transaction amount, volume of transactions, and history of declined / NSF backup funding transfers. Although there hasn't been a rampant problem on my account, I have had debit card backup funding transfers fail my bank for non-sufficient funds. The transactions related to those transfers were transactions from MY card, not Karen's. It is possible (however I figure improbable) that this could have something to do with a lower threshhold limit being set on a card. I would think, however if this were the case that 1) The threshhold would apply to ALL plates associated with the account, since all plates share the same backup funding source and 2) that such a threshhold would be lifted after a period of time (say 90 days) of positive account activity.

I'm presently very aggressively trying to get in touch with a liver person at eBay / PayPal corporate who can assist me in resolving this once and for all. In the meantime, I would appreciate it if member of the community could answer these questions. It's important to answer these honestly and completely, in order that I can try and find the core pattern here:

1) Does your debit card appear to have a magic "threshhold" at which it always declines? What is the approximate aount of that threshhold (Mine, for example is about $150)

2) When your card declines, does it then decline everything for a period of time? If so, how long? If your card doesn't currently exhibit this behavior, did it used to at one point?

3) Do you have more than one PayPal debit card on the same account (for your spouse, for example)? If so, are the last names of the two users the same?

4) If you have more than one PayPal debit card, do both cards decline subject to the same pattern? (for example, do they both decline at about the same "magic" amount?

5) Have you ever had non-sufficient funds activity on your PayPal account? If so, was it from the debit card, and it was, which one?

6) If you've ever had NSF activity on your PayPal account for backup funding transfers, was the NSF resolved on the second ACH attempt?

7) If the second ACH attempt also failed, was the attempt to bill your backup credit card successful in resolving the issue?

8) Have you ever had a situation where you use your PayPal debit card to make a purchase, and the purchase is approved and the balance deducted from your PayPal account, but no backup funding transfer takes place? (thus putting your PayPal account balance in the negative)? It's been a while, but I had this problem on a couple of occasions about a year ago, and of course it will cause your card to decline, until you bring the balance back in the black again.

9) What are the max daily limits you have set in your PayPal profile for each of your debit cards?

10) Have you ever attempted to make purchase for an amount greater than the "magic" decline amount, but iwth money actuall IN your PayPal account (thus not requiring backup funding)? If so, did the purchase decline anyway? I've never tried this, but need to. My hunch is that since one card works and the other does not, that it doesn't have anything to do with the account balance but rathe rsome arbitrary threshhold or flag on the actual card or "user instance" itself. I can better support this argument if some of you have actually had transactions decline when you have the money in your PayPal account (by "in" the account, I mean that it's there, and available, not in a "pending" state.)

I apologize for the length of this post, and thank your for your attention in reading. Again, I would appreciate your answering the questions in their entirety so that I can complete the research and get after these people to FIX this once and for all. Please don't include personal information such as user names, account numbers, etc. in your replies. I do not need any personally identifying information related to your account-- Just the facts surrounding the account and debit card parameters so that I can try and establish a pattern to this issue. I'll post my findings here as they surface. If there is indeed a resolution to be found here, I GUARANTEE you that I will find it.

Regards,

-- Jim
Photo of Eric Suesz

Eric Suesz

  • 14 Posts
  • 0 Likes
Jim, this is a very interesting reply. You seem to have put some real thought into this. I think you should start a new topic on Get Satisfaction and post this text in it, and perhaps you can get the responses you need to help troubleshoot this. If this is a fixable problem, you might be able to really help PayPal out here, while at the same time relieving the frustration you've been having.
Photo of

  • 11 Posts
  • 0 Likes
I have started a new thread on this topic. I'll continue to follow this one for replies, but I would prefer if you post replies to my survey and research request in the new thread. You can find it here.
Photo of Thinkingman.com

Thinkingman.com

  • 6 Posts
  • 0 Likes
I’ve figured it out. I recently did a couple of large transactions using my debit card. One of them went over my PayPal balance and pulled from my bank, who declined it. Fast-forward to months later, I’ve transferred most of my dough to a bank account, and I’m making a small transaction on PayPal. Since there really isn’t anything in the PayPal account at all, it pulls from my bank. My bank has (of course) sufficient funds to cover this. But because my bank has “suffered at the hands of PayPal” it refuses to authorize the transfer. Thus, the problem is my bank’s fault, not PayPal’s. However, PayPal’s fault in this situation is no less: instead of informing you about any of this process, or helping you to resolve the issue, they give you a big blank screen of death and/or (if the website owner is using PayPal’s APIs, like I do when designing clients’ websites), a dumb, meaningless error message, often without even an error number to reference it with. If you get any error numbers, I’d highly recommend you post them here, as it will help many people in the future. Error numbers look like this, a lot of the time: ERROR 3432: YOUR TRANSACTION WAS DECLINED.
Photo of 8bit Revolution8R

8bit Revolution

  • 2 Posts
  • 0 Likes
Maybe I can get some help on this issue.
It was a simple problem that then escalated into a nightmare.
Back in oct of this year, my mother tried to link her bank account to paypal so I can user my student card.

Paypal sent the deposit and everything looked good. But not so fast, somehow it didn't take and the back account wasn't linked.

So we called Paypals' costumer service.

They said that they will send an email to fix this problem, but the same thing kept happening. Its now DEC and no back account on paypal at all.

Now to make matters worst, my debit card is working, EVERYWHERE but on paypal. Meaning, I can make payments at McDonald's, giant, etc, but when I go to make online payments, Paypal won't let me use my account OR my card.

I have enough funds, but still nope.

And as you guessed it, the people at CS are about as helpful as a dead horse.

I swear, if there was another way to make payments to places OTHER than paypal, I would use it in a heartbeat.
Photo of Mwesigwa Samueels

Mwesigwa Samueels

  • 1 Post
  • 0 Likes
i have tried to have my debit VISA card added to paypal account for the last two months but whenever i try, i get the same error message; "This credit card has been denied by the bank that issued your credit card. For details on why your card was denied, please contact your credit card issuer's customer service department. Or, you may want to try adding a different credit card." I have contact my bank headquarters (VISA Card center) several times but they failed to detect the error. i also consulted other three banks but all in vain. the first reply to my mail from Paypal on this; the paypal rep told me that it could be due to insufficient funds on card, or my bank hard protected the card against online transaction as a security measure final paypal advised me to contact my bank. but my bank denied all the allegations. when i sent the second mail IT WAS NOT REPLIED UP TO NOW.

This is therefore to request all all readers to advise me on any other reliable or competent provider (apart from Google checkout) who can provide me the similar but quality and consumer user friendly service without such hassle.

I own an online based business where my customers are expected to make online payments direct to my account. but this preliminary experience has given me a lesson.
Photo of

  • 11 Posts
  • 0 Likes
Make sure your bank has a "Shipping address" on your file. PayPal uses that field to validate you. It matches on Name + House Number + Postal Code, so there's a good chance that there is a mismatch between what PayPal has for you and what your bank has. I had this issue once because PayPal knew me as "Jim", when my legal name is "James". I also own two homes, and had to be sure the bank had the right one that corresponded with my merchant account. Hope that helps!

-- James
Photo of elvira lopezEL

elvira lopez

  • 1 Post
  • 0 Likes
I am sorry to hear that. I just began using Paypal and tried to pay at Walmart and for some reason it was declined. I just have to check what went wrong. i will keep you posted.
Photo of

  • 11 Posts
  • 0 Likes
Hi. I was the OP in this thread. In the interest of full disclosure, I posted this a very, very, VERY long time ago and once the issue finally got solved, I have never experienced any problems again (although dealing with the repeated seemingly secret "security measures" was very annoying). To this day I suspect that was a catch-all answer for "I have no idea why it's doing that sir!". Anyhow, with that said...

From your main PayPal screen (where your recent activity shows up), you can go to the menu at the top and select Profile, then MY MONEY. On the screen that comes up, you'll see the section "PayPal Debit MasterCard". Click UPDATE. In there, you will see "Current Backup Limit". If you hover over that link, it will tell this but... That value you see represents the difference between your total backup funding limit and whatever authorizations have not been "Completed" (e.g., things that still show "Pending").

I'm telling you that because I have on a few rare occasions seen where that value didn't reconcile with what was still Pending; it was like one or two charges were stuck out there. One phone call and they cleared the holds and I was back in business though. So, if you really did experience a denial, check that area and see if you're maybe having the same problem.

FYI... You can't change your backup funding options if you have stuff "Pending". So, if you do, give it a couple of days and don't use your card. Once everything goes to "Completed", you can update it. Hope that helps! I laugh all the way to the bank every month when I get my $80-$200 cash back bonus for using my PayPal Debit MasterCard... Love it! :)

--James