The document prohibits PayPal transactions associated with pyramid schemes, pre-sale of uncontrolled goods, third-party payment collection, currency exchange, certain credit and debt services, and bribery or corruption payments.
This analysis describes what PayPal's agreement states, permits, or reserves. It does not constitute a legal determination about enforceability. Regulatory applicability and practical outcomes may vary by jurisdiction, enforcement context, and individual circumstances. Read our methodology
This provision restricts a range of financial service transaction types that may otherwise be lawful in certain jurisdictions, including currency exchange, check cashing, and certain credit services; merchants in these categories must seek pre-approval under the separate payment facilitator category or cease use of PayPal for these activities.
Interpretive note: Qualified terms including 'certain multi-level marketing programs,' 'certain credit repair,' and 'certain credit transactions' are not defined in the document, creating ambiguity about the precise scope of the prohibition.
Under this clause, users who process payments for prohibited financial services categories, including pre-sold goods, currency exchange, and bribery-related transfers, are in breach of the AUP. The prohibition on 'certain credit repair' and 'certain multi-level marketing programs' uses qualified language that is not further defined in the document.
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Compare across platforms →"relate to transactions that (a) show the personal information of third parties in violation of applicable law, (b) support pyramid or ponzi schemes, matrix programs, other "get rich quick" schemes or certain multi-level marketing programs, (c) are associated with purchases of annuities or lottery contracts, lay-away systems, off-shore banking or transactions to finance or refinance debts funded by a credit card, (d) are for the sale of certain items before the seller has control or possession of the item, (e) are by payment processors to collect payments on behalf of merchants, (f) are associated with the sale of traveler's checks or money orders, (g) involve currency exchanges or check cashing businesses, (h) involve certain credit repair, debt settlement services, credit transactions or insurance activities, or (i) involve offering or receiving payments for the purpose of bribery or corruption.Excerpt from PayPal's Acceptable Use Policy
(1) REGULATORY LANDSCAPE: The prohibition on pyramid and Ponzi schemes engages FTC enforcement authority under Section 5 of the FTC Act and SEC jurisdiction where securities fraud elements are present.
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This provision restricts a range of financial service transaction types that may otherwise be lawful in certain jurisdictions, including currency exchange, check cashing, and certain credit services; merchants in these categories must seek pre-approval under the separate payment facilitator category or cease use of PayPal for these activities.
Under this clause, users who process payments for prohibited financial services categories, including pre-sold goods, currency exchange, and bribery-related transfers, are in breach of the AUP. The prohibition on 'certain credit repair' and 'certain multi-level marketing programs' uses qualified language that is not further defined in the document.
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