The agreement authorizes PayPal to hold funds in a limited or terminated account for up to 180 days to cover potential chargebacks, disputes, claims, fees, fines, and penalties.
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 creates a significant liquidity risk for business users who rely on PayPal balances for operational cash flow, as the agreement reserves the right to withhold funds for up to 180 days following an account limitation or termination triggered by PayPal's assessment of risk or policy violation.
Current version removes specific language about rolling reserves withholding transaction amounts and simplifies the hold rationale to general liability protection, broadening PayPal's discretion.
View full change record →Under this clause, if PayPal limits or terminates an account, the account balance may be held for up to 180 days before being released, with held funds used to satisfy chargebacks, claims, fees, or penalties that arise during that period. This applies to both personal and business account holders.
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"If we limit your account, funds may be held in your account for up to 180 days if necessary to protect against the risk of reversals, chargebacks, claims, fees, fines, penalties and other liability.Excerpt from PayPal's User Agreement
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This provision creates a significant liquidity risk for business users who rely on PayPal balances for operational cash flow, as the agreement reserves the right to withhold funds for up to 180 days following an account limitation or termination triggered by PayPal's assessment of risk or policy violation.
Under this clause, if PayPal limits or terminates an account, the account balance may be held for up to 180 days before being released, with held funds used to satisfy chargebacks, claims, fees, or penalties that arise during that period. This applies to both personal and business account holders.
ConductAtlas has identified this type of provision across 277 platforms. See the full comparison.
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