Big PayPal Changes To Come, Hated Frozen Funds Policy Will Be Amended

big paypal changes

Big PayPal changes are coming, and the online payment processing service may placate more web users who have fallen afoul of the service’s much disliked “frozen funds” policy.

The big PayPal changes have been trumpeted by the service as “aggressive,” and while PayPal has taken much public flak for its propensity to freeze accounts and thus, often, all the money available to small-time businesses, that may be changing — Anuj Nayar, PayPal’s senior director of communications, said that the planned policy update would have a large impact on how people can expect PayPal to handle the circumstance.

Nayar told CNNMoney:

“These are not minor — these are aggressive changes … This is a fundamental shift in our business operations.”

So exactly how would the big PayPal changes affect you and your PayPal dealings — Nayar refused to say.

While not detailing the changes planned for instances of frozen funds, the PayPal exec did say that when the amendment hits, it will be easier for users to find a way out of the issue instead of languishing indefinitely without access to their money:

“We want to be clear about how people can get out of the [frozen funds] situation … We need to get better about helping people, or explaining why actions are being taken.”

CNNMoney spoke with one high-profile user of PayPal who had been negatively affected by the frozen funds problem — author Jay Lake, who had fallen afoul of the current rules when raising funds for cancer research.

Paypal Retailer Agreements

Lake, who has been diagnosed with advanced colon cancer, says the rules now — the ones not affected by the big PayPal changes — seem to make it virtually impossible to unfreeze funds in many legitimate situations:

“They wanted me to provide receipts, shipping information, business paperwork … That obviously didn’t apply to me, but there was no way to bypass the process. I called, and they said appeals take 24 to 72 hours to get going. I asked, ‘How I do prove I’m not conducting transactions?'”

Lake points out that given his high-visibility, a fix was more easily found, but average users won’t be so lucky. But of the impending big PayPal changes, Nayar assures frustrated users that “2013 is going to be the year that we fix a lot of those pain points.”