Paypal 21 Day Payment Hold on eBay Sales – What It Is and How to Deal With It

21 May

You may also be interested in these guides: EBay Expands 21 Day Payment Hold Policy To All Sellers? and eBay and Paypal Seller Protection Policy – What’s Really Covered

At the beginning of 2008, Paypal instituted a policy dubbed the “21-Day Hold.”  This policy gives Paypal the right to restrict sellers from withdrawing a buyer’s payment from their Paypal account.  In effect, this denies the seller access to their money for at least 21 days, depending on whether or not the buyer is satisfied with the item they receive.  Paypal instituted this policy when they began beefing up their “Paypal Buyer Protection Policy.“  Paypal tells buyers that they will receive a refund from Paypal if they go through dispute resolution properly and their complaint qualifies for a refund. In reality, the money for the refund comes from the seller’s account, rather than Paypal’s own pot of gold.  To guarantee that the money will be readily available should a refund be necessary, Paypal holds the payment to give the buyer ample time to report a problem.  In the past, sellers had the opportunity to sell expensive items, collect payment, withdraw the money to their checking account, and then disappear.  Paypal would try to get the money back for the buyers but they would make no guarantee.  If Paypal was unable to retrieve the funds then the buyer would be out of luck and receive nothing unless they paid with a credit card and filed a chargeback.

The major problem with this policy is that Paypal doesn’t make it clear to sellers that this is going to happen. The only warning is a little blurb on the first page of the eBay Sell Your Item form under “Decide how you’d like to be paid.”   People making their first couple of sales on eBay are generally overwhelmed by the amount of policies in place, not to mention all of the other information they have to learn to be successful on eBay.  I’ve run a seminar that lasted more than two hours on nothing but item titles.  The amount of knowledge necessary to find success on eBay is staggering.  Many new sellers that receive the email saying Paypal is holding their hard earned money panic and don’t know what to do.  The question that comes up most often is, “Do I really send a $500 item across the country to someone I don’t know when I haven’t even been paid for it?”  The obvious answer is “no way.”  Unfortunately, when selling on eBay this is what you are forced to do.  No exceptions.

How Do I Know If A Payment is Being Held by Paypal?

The email you receive from service@paypal when the buyer submits payment will have the subject, “NOTICE OF PAYMENT RECEIVED – PLEASE SHIP ITEM.”  The email will look like this:

Paypal 21-Day Hold Email

Paypal 21-Day Hold Email

You’ve received a payment, detailed below. We’ve placed a temporary hold on the funds for this transaction.

PayPal and eBay are working together to make payments for eBay items even safer. Because we want both buyers and sellers to feel confident about sending and receiving payments through PayPal, we may temporarily hold payments for items sold on eBay.

Make sure to ship the item right away, so you’ll have access to the funds sooner. We’ll release the hold in 21 days unless you receive a dispute, claim, chargeback, or reversal on the transaction subject to the hold. We may release the hold earlier if either of the following occurs:

  • The buyer leaves you positive feedback on eBay.
  • We confirm that the item was delivered.* We can confirm delivery if you ship the item with USPS, FedEx, or UPS and either use PayPal shipping labels or upload tracking information from the transaction details page. This applies to transactions within the United States.

Additional hold period

If you receive a dispute, claim, chargeback, or reversal on the transaction subject to the hold, we may hold the payment until the problem is resolved.”

The transaction details page in your Paypal account will have this disclaimer at the top:

eBay 21-Day Hold Payment

When the funds are released you will receive another email from with the subject, “NOTICE OF FUNDS AVAILABLE” and it will state relevant information like the buyer’s name, the amount of the transaction, and the transaction ID number.

Who is Subjected to the 21 Day Payment Hold?

The Paypal 21-Day Hold only happens on eBay sales because Paypal Buyer Protection is only valid on eBay purchases.  Remember, the only reason this policy exists is to benefit Paypal.  They don’t want to refund buyers out of their own pocket.  In order to guarantee the funds are available to refund, Paypal limits the seller’s ability to withdraw the money.

According to Paypal, they hold payments for sellers who meet any of the following conditions:

  • You have been an eBay member for less than 6 months, and you sell an item for more than $100, or
  • You have an eBay feedback score of less than 100, and you sell an item for more than $100, or
  • You have a Buyer dissatisfaction percentage** 5% or greater than 5%, or
  • You have an average Detailed Seller Rating (DSR) of less than 4.5, or
  • You have received fewer than 20 Detailed Seller Ratings in the last 12 months, or
  • You are listing your item in a high-risk category such as gift certificates, video games, cell phones, computers or consumer electronics.

If you meet any of these critera your money will be held by Paypal.  Paypal says the amount of transactions affected by the 21 Day Hold is “usually less than 5 percent.”  If there are currently around 27 million listings on eBay that means almost 1.5 million of those transactions will potentially be held by Paypal at one time or another.  Paypal will stop holding payments if you meet these criteria:

  • You have been an eBay member for 6-months or more, and
  • Your total Feedback score is 100 or greater, and
  • Your Buyer dissatisfaction percentage** is less than 5%.


  • Your average DSR is 4.5 or greater and
  • Your have received 20 or more DSRs in the last 12-months
  • Your buyer dissatisfaction percentage is less than 5%

Buyer dissatisfaction percentage is measured by adding negative events as a percentage of your transactions. Negative events include negative & neutral Feedback, Detailed Seller Ratings scores of 2 or lower, and disputes for items not received or significantly not as described.

Like with Selling Limits, Paypal holds payments based on each individual UserID.  This means that if you create a new UserID you will be subjected to the Paypal 21 Day Hold as though you have no selling history with eBay.  You could have an account with a feedback score of 10,000 with 100% positive feedback, but if you open new UserID you will still have Paypal holds on that new UserID.

When Does Paypal Release The Funds?

As explained before, the purpose of the hold is to keep the buyer’s payment in the seller’s Paypal account until Paypal can confirm the buyer is satisfied with the transaction.  Paypal is then off the hook to cover the payment under “Buyer Protection” so they are willing to release the money.  Paypal will release the funds earlier than 21 days if the buyer leaves positive feedback or 3 days after Paypal confirms the item was delivered.  Paypal can only confirm delivery if you shipped the item through Paypal MultiOrder Shipping or the “Print Shipping Label” button from the Paypal transaction details page.  If you ship your items at the Post Office or print the shipping labels from or another website and manually input tracking information, Paypal will not be able to confirm delivery and you will have to wait the full 21 days unless a buyer leaves positive feedback.  The problem with this is that Paypal does not release any part of the payment including the shipping charge.  This means you will have to pay for shipping out of your own pocket.  Also, if you don’t have any money in your Paypal account when you accept the payment that gets held, you will either have to print the shipping label elsewhere, wait to transfer funds to Paypal from a checking account, or pay with a credit card.

I don’t recommend hounding buyers begging them to leave positive feedback so your funds will be released.  If you are concerned about getting your payment as soon as possible you should check the Delivery Confirmation number or tracking information to make sure the item has been delivered.  If it has, send the buyer a message through eBay asking if they received the item and whether or not they are satisfied with it.  If they respond that they are, ask them nicely to leave positive feedback and tell them you’ll do the same.  This should also get you higher Detailed Seller Ratings as it appears that you’re concerned about the buyer’s satisfaction.  If you printed the shipping label through Paypal, they are pretty good about releasing payments automatically like they say they will.  If you check the Delivery Confirmation or tracking number and 5 or more days have passed since it shows it was delivered and the payment still has not been released, you can call Paypal at 1-888-221-1161.  Tell them that the item has been delivered and you are wondering when the payment will be released.  They should be able to release it if there’s no problem with the transaction.  You won’t get anywhere trying to email them as their email support is completely worthless.

What If A Seller Refuses to Ship the Item Unless the Buyer Leaves Positive Feedback or Refuses to Ship Until 21 Days Passes?

This is an unfortunate consequence of the 21 Day Hold.  Some sellers will see that the payment is being held by Paypal for 21 days and refuse to ship the item to the buyer.  If you purchase an item and the seller refuses to ship it you should link them to this article that explains what the 21 Day Hold is.  If they still refuse to ship the item unless you leave positive feedback or wait 21 days you should open a dispute in the Paypal Resolution Center.  Do not agree to wait 3 weeks for your item or leave positive feedback before the item is received and you are satisfied with it.  Paypal will refund your payment if the seller doesn’t.

How Can I Get Around the 21 Day Hold?

Unlike with Selling Limits or Search Delay , this is one policy that there isn’t really any way of getting around.  The only way to get around it in the future is to sell items and receive excellent Detailed Seller Ratings.  Paypal and eBay are extraordinarily good at doing one thing – making and keeping money.  It’s in Paypal’s best interest to hold as many payments as possible so they won’t have to refund buyer’s payments out of their own pocket.  If they thought they could get away with holding every payment they probably would.  As a seller, you will have to play the game eBay’s way.  Your best bet is to ship your items immediately and print the shipping labels via Paypal.  If you ship Priority Mail the day after you receive payment, you should get the funds released to you within 7 days (4 days in transit and 3 days to confirm delivery).

The 21 Day Hold isn’t necessarily a ridiculous policy.  It guarantees that the seller will not receive payment for an item and disappear into the night.  Many merchant accounts require sellers to keep money in a rolling reserve to cover chargebacks.  This is the same idea.  The problem is that Paypal doesn’t make it clear to buyers and sellers that the policy exists.  As usual, they also also don’t do an adequate job of explaining why it exists.  They’re so caught up in their happy bureaucratic hocus pocus talk that they’re entirely unable to give it to us straight.   As the seller, you aren’t in any additional danger of losing the payment if it’s held for 21 days.  Long after all of your payments are instant, you still run the risk of buyers filing bogus disputes and chargebacks.  If you don’t have the money to cover the refund in your Paypal account, Paypal will try to get it from your bank.  If that doesn’t work they send it to collections.  If you ship quickly and properly you should have no problem getting most payments released within a week.  The 21 Day Hold is another hassle that eBay has instituted in the past couple of years.  When you hear about eBay sellers being disgruntled and leaving the platform for other auction sites and payment services this is what they’re talking about.  If you’re willing to play the game, and it is ultimately worth it to do so, you can minimize the hassle if you play properly.
If you found this guide helpful, check out the site index by clicking here for 75+ more guides including how to get around eBay selling limits, enabling PayPal’s merchant rate to save money on fees, and raising your auction and fixed price visibility in best match search.

13 Responses to “Paypal 21 Day Payment Hold on eBay Sales – What It Is and How to Deal With It”

  1. Payment Remittance 18. Aug, 2009 at 4:47 am #


    Just found your blog on Technorati & Digg upcomming news feeds and read a few of your other posts.
    ISeems good contents,Keep up the good work. Look forward to reading more from you in the future.


  2. nancy 15. Mar, 2010 at 7:17 pm #

    I just log into my paypal account and they limited my account and want me to provide: photo Id, supplier invoice, ssn, credit check and proof of address. Why did they do this? I do not want to provide these personal information also the name on the account is a different name. What do I do?

  3. erica 21. Jun, 2010 at 5:38 pm #

    paypal is unfair buyers should use their judgement when buying we have to sell our stuff cheap if we need the money so why should we have to struggle around to get the shipping money and wait for our funds to be released it is not smart to send an item without having the money in your hand we the sellers are at risk of selling to an unfair buyer i would rather sell my stuff at the flea market i get the cash in my hand nobody has control over my money except for me sorry paypal ebay you lost a customer for being unfair why do you want to hold our money bank on your own.

  4. Long Time eBayer 06. Aug, 2010 at 5:14 am #

    I’ve read many articles and opinions about this new policy and everybody seems to look at it from the seller’s point of view. What about the buyer? If we’ve left positive feedback to help the seller out, can we still claim if we haven’t recieved the item within 21 days? This whole new scheme seems dodgy for buyer & seller

  5. Billy 20. Aug, 2010 at 3:18 am #

    I wish I’d sold my crap in the front yard.

  6. Billy 20. Aug, 2010 at 3:18 am #

    I wish I’d sold my crap in the front yard.

  7. Frank 15. Aug, 2011 at 6:33 pm #

    I velieve no one should take this from paypal, they should close the paypal account. GO DO BUSINESS WITH SOME ONE THAT APRECIATE YOUR BUSINESS.

  8. Frank 15. Aug, 2011 at 6:39 pm #

    I shipped my mechandise 7 days ago was delivered, when I checked in the usps website it says they were delivered, on Paypa’s web site it keeps showing is it out for delivery Customes had received their mechandise and I email them for them to write a feedback and none of them have wrote anything, here I am waiting 7 days to get pay. This is ridiculous, why do i have to take this trash? As soon as I get my money I am closing my account with paypal. Why should we give Paypal our business if they don’t respect our?

  9. My name 25. Aug, 2011 at 7:05 pm #

    I closed my account with them… I’m well off, I save my money and I have funds put away for many rainy days… I don’t need the money I earn on eBay instantly… but it’s my money and I should be able to choose whether I want that kind of “protection”… it’s funny how PayPal earns interest on my monay… the longer they have that money, the more interest they rake in. That’s all it is… a feeble justification they use in order to collect as much money as possible… and you are too lazy to do anything about it. Close the account and use Moneybookers… it’s just as simple and they don’t have the holds… and the daily limit is around 15k… not bad huh.

  10. Shannyn Snyder 27. Aug, 2011 at 7:31 am #

    I started a petition about this at Need support!

  11. suzy 21. Apr, 2012 at 4:06 am #

    21 days is excessive. what if you sell a whole load of stuff but dont have the cash already of your own to post the goods? i appriciate they are trying to revent fraud, etc… but this is just taking the piss. on ebay though you do need to offer paypal as an option. but fuck this. soon as i get my money into my bank im leaving ebay/ paypal. pile ah pish so it is

  12. ANGRY 14. Jan, 2015 at 9:49 pm #

    why do i have to jump through hoops to get my money?

    Ebay/Paypal is a bullshit company protected by bullshit politicians.

    i pray they go belly up and their CEO gets a brain tumor at the base of his brain stem

    they are criminals who need to be put in a cell

  13. Ryan Bee 14. Jan, 2015 at 10:51 pm #

    This is total BS. I sold several large value items today that I CANNOT BUY to ship in the first place without the funds being released. I have been an eBay and Paypal customer for over TEN YEARS, 100% feedback with 130+ transactions, and $2300+ value sold. Forget this, I am busting their policies, contacting the buyers directly to complete the sale, and cutting ebay and paypal completely out of the transaction. Greedy pricks.

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