My Love-Hate Relationship with Paypal

I just got off the phone with Paypal to lift the "Limited" status from our account, again; the second time in last 7 days.

I started writing this article a few days ago not knowing I would be blessed with an immediate reminder of  my love-hate relationship with Paypal.

First, I despise financial institutions. I think a strong case can be made that they are the root of all evil, literally.

The sad reality is that we still rely on them. For those of us who make our money online, Paypal is essential.  It's simply a necessity for digital nomads like ourselves.

Paypal, in theory, is easy to use. Just sign up and put in an email address to use as your payment address. and transfer money to people by simply entering their email address and your done. It allows us to easily process borderless payments in any currency. It's brilliant!

The problems seem to arise when you try to get your money out or if your transactions exceed some arbitrary limit, or a host of other reasons. One of the worst things about Paypal besides its service and the fact that accounts can be blocked is how much it charges for foreign currency transfers. Obviously a huge problem when living in other countries. The bottom line is that you will pay up to 4% in fees. 4%, that is a lot over a year! View this comparison of Transferwise vs Paypal and see for yourself.

Of course these issues can be fixed somewhat by getting "Verified" which entails tying your Paypal account to your personal bank account with debit card information and/or credit card info, your social security number, and a DNA sample of your firstborn. Okay, I made the last one up.

But it's not too far off from what Paypal actually knows about your past.  It's understandable for security purposes why a financial services company would need as much intimate bank information possible. Yet,the issue of privacy is of some concern.  

I mean they knew stuff about us from 20 years ago. When they gave me a multiple choice test to verify who I was over the phone, I failed. 

What can I say, besides having a bad memory, I was a bit shocked that they even knew my rental addresses in California from 17 years ago or the names of random LLCs I set up when I bought and sold real estate nearly a decade ago. I was actually sweating during the exam like a witness on the stand.  So, I failed, and promptly asked to speak to a supervisor.  

As a side note, everyone I have dealt with on the phone at Paypal has been extremely courteous and professional and managed to restore my account, temporarily anyways.

"The constant freezing of my account to preempt fraud is really freaking annoying," I tell the supervisor. "How about I just notify you if I suspect suspicious activity? That would be enough fraud protection for me if that can get this account working smoothly?" I ask. 

They told me it was probably because we log in from different IP addresses during our travels or when we log in from a different computer, and not from suspicious transfers or limit requirements.

"Great!", I said. "Just set it to not recognize different IP addresses as fraud, and I will be the first to notify you if anything appears out of the ordinary." 

Nope, not gonna do it.

"You have to be located inside your home at the address registered to your account for us to give you that option," she told me gently sensing my disappointment knowing that I was calling from Cambodia.  

I'm thinking, ohh that's right, you still haven't you verified who I am yet even though I had to say my account information and the secret code you gave me one number at a time to a freaking computer for ten minutes just for the privilege to speak to a human.

So the supervisor asks me another series of multiple choice questions with yet more older-than-a-decade random addresses and LLCs probably linked to my social security number that they likely ran through some government database without my permission.

But this time, calm and prepared, I aced the test.  My account was once again restored in all its previous glory and I swiftly withdrew my current balance to my small-town savings bank account.

Ultimately, we love and require Paypal's services, so we must comply.  But it doesn't mean I can't complain about their privacy policies and God complex to limit access to our funds.

The quotes above are to the best of my recollection, but Paypal assured me they have the recording stored along with the rest of my entire financial history -- and the DNA of my firstborn;).

(Paypal image Source)

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  1. I have the problem of living in Korea and because i do not have a Korean national id I cannot transfer money from Paypal to my bank account. When I receive money via Paypal I must use it for online purchases. Sometimes that's okay, but most times I want the money in my hand to so with as I wish. Paypal tells me they have nothing to do with this restriction. It's Korean law. It annoys me to no end!

  2. You just have to set it all up before you leave your home country. So far I've not had an issue just yet thankfully. I do suggest sending a note to the VPs or CEOs, just look up their details on the corporate side of the Web site. Explain what your travel plans and suggest real ideas as you have here. I think they will listen.

    I just had an e-mail encounter that was not so good with them as their help instructions don't match the web site; they sent me a survey which I'm filling out to let them know how I felt about it.

  3. Yes, setting it up before leaving would be best but when we left 6 years ago we were hardly ever using it. Now we need it far more and will not be in the US for a long time. Oh well good lesson I guess:)

  4. Hi, Bohemians.

    We've had our PayPal account for a decade but rarely use it. Now we're about to set out on the road again, and this time we will be using the account for business. Besides notifying PayPal that we'll be out of the country, what else would we need to do?

  5. Just be sure you only have 1 account and get it connected to your bank account. Once you do that be sure to get "verified" so that you can increase the limits they impose on transfers. Also connect any credit cards to it that you may need. Your best bet is probably to call Paypal, speak to them about your situation so you can be sure all your ducks are in a row!

  6. I haven't even started my travels yet and I already have this problem with PayPal! I don't know why... but it seems like every time I do ANYTHING with my PayPal account they need to re-verify it. It's incredibly frustrating. On the other hand, it seems to never happen to my husband. The only thing I can see that we do differently is that I like to "withdraw money" and he leaves it in his PayPal for the next time he needs to purchase something.


    1. Ughh, it is so frustrating. But when you are still at home it is much easier to deal with. Try and get it all in order before any traveling, if you can! Good luck!