This is the legal contract between you and PayPal that governs how your account works, what fees you may be charged, and what happens when something goes wrong with a payment. PayPal can limit or freeze your account, hold your funds, and change the terms of service with as little as 21 days' notice for personal users. Importantly, by using PayPal you agree to settle disputes through arbitration rather than in court, and you give up the right to join class action lawsuits against PayPal.
Technical Summary
The PayPal User Agreement is a comprehensive contractual framework governing the use of PayPal accounts and payment services for U.S.-based personal and business account holders. Key provisions include mandatory binding arbitration with a class action waiver, broad account limitation and suspension rights reserved by PayPal, fee structures for transactions and currency conversions, and detailed dispute resolution procedures including the PayPal Purchase Protection program. The agreement also establishes PayPal's rights to hold funds, restrict accounts, share user data with third parties, and unilaterally amend terms with limited advance notice (as few as 5 days for business accounts and 21 days for personal accounts). Notably, users consent to credit report inquiries upon opening business accounts and to electronic communications delivery in lieu of paper notices.
Institutional Analysis
The agreement engages multiple regulatory frameworks, including the Electronic Fund Transfer Act (EFTA), Bank Secrecy Act/AML compliance obligations, and state money transmission laws applicable acro…
The agreement engages multiple regulatory frameworks, including the Electronic Fund Transfer Act (EFTA), Bank Secrecy Act/AML compliance obligations, and state money transmission laws applicable across U.S. jurisdictions. The mandatory arbitration clause with class action waiver is a material litig…
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By using PayPal, you agree that any dispute with PayPal must be resolved through individual arbitration rather than in court, and you cannot join or participate in class action lawsuits against PayPal.
PayPal can restrict, freeze, or limit your account and hold your funds if it suspects policy violations, unusual activity, or increased risk — sometimes for extended periods while investigations are conducted.
PayPal can terminate or suspend your account if you violate its Acceptable Use Policy, which prohibits use of PayPal for certain goods, services, or activities, and PayPal may hold your funds during any investigation.
PayPal can change the terms of this agreement at any time, giving personal account holders as little as 21 days' notice and business account holders as little as 5 days' notice before changes take effect.
PayPal charges fees for many types of transactions, including sending money, receiving payments, and converting between currencies, with specific rates published on their Fee pages.
PayPal offers purchase protection for eligible transactions, which can reimburse buyers if an item is not received or is significantly different from its description — but only for transactions that meet specific eligibility conditions.
By opening or converting to a business account, you consent to PayPal pulling your personal and/or business credit report at account opening and whenever PayPal believes there is increased risk.
PayPal limits its liability for losses, damages, or costs you suffer to the direct damages actually incurred, and explicitly excludes liability for indirect, special, or consequential damages.
This agreement is governed by the laws of the State of Delaware and any arbitration or court proceedings (if arbitration is opted out of) must take place in Santa Clara County, California.