Category: PAYMENT PROCESSING

  • PayPal Gets Sued, Stripe Could Be Next – Is Your Business Safe?

    PayPal Gets Sued, Stripe Could Be Next – Is Your Business Safe?

    You’ve probably heard the news: PayPal gets sued for freezing customer accounts without explanation. It’s no longer speculation, it’s a fact. The class action has been filed and it will be interesting to see how it all shakes out in the end. But it raises some important questions about your own online business and how you’re funded.

    This isn’t the first time they’ve been threatened regarding PayPal freezing accounts suddenly or withheld funds. But in the case of Chris Moneymaker, they immediately returned his as soon as he started drumming up some noise.

    This time, it seems they’ve lost this cruel game of chicken. PayPal account holders are speaking out and loud about these unfair practices.

    What Exactly Are They Being Sued for in This PayPal Lawsuit?

    In this particular PayPal lawsuit, the company is being sued for 3 things.

    Committing Conversion

    In the simplest terms possible, conversion is stealing. Someone else’s property is converted and now owned by someone else. It’s wrongfully taking control over someone’s belongings, land, amount of money, etc.

    In this case, PayPal freezes accounts but refuses to give those funds back. The plaintiffs are claiming this is theft, therefore they are committing conversion.

    This also goes beyond just the frozen funds. PayPal is accused of conversion in relation to RICO, the federal Racketeer Influenced and Corrupt Organizations Act. This means they not only froze PayPal account funds, but they also refused to explain why. The definition of thievery.

    On top of this, PayPal required plaintiffs get a subpoena to learn why their funds were taken.

    Breach of Contract

    The PayPal user agreement is 65 pages long. Usually, they freeze account funds for violating those terms for up to 6 months. However, the tables have turned. PayPal is on the being sued for breaching their own contract with users.

    News articles about the lawsuit haven’t explicitly stated what part of the contract was violated, likely because lawyers don’t want to reveal their arguments before trial.

    Unjust Enrichment

    Going along with the conversion aspect, PayPal is accused of being unjustly enriched at the expense of another by taking advantage of that other’s vulnerability. Basically, they’ve benefited from someone else’s work (or money, in this case).

    How Does This Affect Other Payment Aggregators?

    Stripe is another big online payment aggregator like PayPal, and they are equally accused (though not legally, yet) of freezing account funds suddenly. They could be next if the dominoes continue to fall.

    Terms of Service Updates in Tow

    If you’re a Stripe business account holder or a PayPal business account holder, you should expect a big update to their terms of service. This also goes for any other payment processing service. They want to protect themselves from meeting the same fate, and the best way to do that is put it in writing.

    If you run a high-risk online store and you use one of these companies, now is the time to make the switch over to your own high-risk merchant account. DirectPayNet can help you in this endeavor. The reason is because payment aggregators like PayPal and Stripe cannot operate with high-risk businesses. They are leasing out a sub-merchant account to you under their own, meaning they’re bound by the terms of their merchant account and can’t make exceptions for you.

    If you operate a low-risk e-commerce store, then you can continue to use your preferred processor like you do now. But the acceptable use policy will only get stricter and even if that isn’t affecting you right now, it could in the future.

    Aggregators Are Allowed to Withhold Funds for 6 Months

    Don’t get confused about what PayPal did wrong. They are legally allowed to withhold funds for up to 6 months.

    Funds are withheld for up to 6 months for merchants who experience a high number of chargebacks. This is called a reserve, and payment processors can choose to withhold up to 100% of disputed items if they wish.

    The reason for this is simple. If a merchant has many chargebacks or refunds, the payment processor is concerned that the merchant may be involved in fraud or some other kind of illegal activity. They don’t want to process payments for that merchant, but they also don’t want to get stuck with a bunch of unpaid chargebacks either.

    This makes sense in theory, but it causes big problems for merchants who have legitimate disputes and chargebacks. If your business isn’t doing anything wrong (and you haven’t been accused of fraud), then there’s no reason for you to have an unusually high rate of chargebacks, and these funds should be released immediately.

    In the PayPal lawsuit, the funds are withheld without reason. It isn’t explicitly stated that frozen PayPal accounts are due to chargebacks or fraud risk. The problem is also that they do this in an instant. No notification at all, with nothing hinting at this happening in your business or personal account information. And if it’s under the premise of investigation, then is that really lawful to freeze 100% of a business’ funds because they think someone fishy might be going on without any hard proof?

    Abusive Policies Toward Businesses

    You’d think if a big payment aggregator like PayPal would want to protect the businesses that use their service daily. That’s how PayPal makes money. But that simply isn’t the case.

    PayPal and Stripe have a long history of abusive policies towards small businesses who use their services. The most notable of these practices is the company’s requirement that users pay extra fees in order to protect themselves from fraudulent activity. In order to get their money back from PayPal or any credit card company, you must prove that the charge was fraudulent (a scam or phishing). This means you have to pay for shipping on goods that never arrive or make a purchase and then wait 30 days for your money back — even if the item is fully functional and never arrives at all. Without this extra protection, you’re out of luck.

    Another reason why PayPal is bad news for small businesses is because it allows customers to file chargebacks with no proof at all. Chargebacks occur when a customer says they didn’t receive an item they paid for, and they can be filed months after the transaction occurred. If a customer files a chargeback against you, PayPal will freeze your account until you can prove they are wrong; while this is happening, you can’t access your money at all — even if you shipped out the item right away and it’s still en route.

    Harm to Small Businesses

    How long do they really need to withhold funds? 6 months is a quite a while but can be reasoned. The bigger question is why does it always take 6 months, or 180 business days? It seems they think you’ll forget about the lost funds by the end of that period of time and PayPal will keep it for themselves. Or the PayPal customer resolution center is so inefficient that they can’t organize a complete investigation in a timely manner.

    This is incredibly harmful to the small businesses that rely on these payment services. It can shut a business down completely, put business owners in serious debt, empty bank accounts, and cause permanent financial and physical stress on those parties. And what if at the end of the investigation, there was no cause for the frozen funds? How does PayPal help those businesses recover? To us, it seems they send a simple, “Sorry!” and that’s the end of the story.

    Make the Switch NOW to Your Own Merchant Account and Avoid Frozen Funds for Good

    This investigation has brought to light a lot of the wrongdoings of big payment aggregators. PayPal freezing funds, Stripe making accounts inaccessible, both withholding money for 6 months–it’s unfair and unjust.

    PayPal might be convenient, allowing you to start selling the next day after opening an account. This is one of the most common reasons businesses use them, but it isn’t worth it. There are several account limitations that hinder growth and can instantly snag large sums of money from you. Your best bet is to avoid aggregators in the first place.

    The solution is to get your own merchant account. No matter what you sell, or the risk factor involved, there is a merchant account for you and a payment processor willing to take you on. And with that, you can continue to accept credit cards like Visa and MasterCard, debit cards, and other payment types without worry.

    DirectPayNet will connect you with the right processor and set you up with a shopping cart that works for your business, along with terms you can get behind. Speak with our customer service reps to open a new account today.

  • Legal Online Telemedicine in The United States: Is Your State on the List?

    Legal Online Telemedicine in The United States: Is Your State on the List?

    With the popularity of online telemedicine in the U.S. growing, it’s important for anyone who wants to use telehealth services or start their own telemedicine business to know about the laws that govern this burgeoning industry.  While there are positive signs that the legal framework surrounding online telemedicine will soon catch up with technology, we’re still some way from knowing what these laws actually are, covering which treatments they apply to, and how they’ll be enforced in practice. In fact, the legal frameworks of both healthcare itself and the provision of telehealth vary widely by state.

    So, the big question is: is online telemedicine legal in all 50 states, or is it too up-in-the-air to make a broad statement like this?

    The Lowdown on Online Telehealth

    Telemedicine is the practice of providing public health care services to patients via electronic communication. It can take place in real time or near-real time and may include live video conferencing, email, telephone, text messaging and other forms of electronic communication.

    The use of telemedicine has increased dramatically over the past decade, given its potential to improve access to healthcare services and reduce costs. Telemedicine can be used for diagnosis and treatment of illnesses and injuries. It has also been used for preventative care as well as health education.

    With technology advancing, especially in terms of security and access, telehealth (i.e., e-health; e-medicine; online pharmacy) is only getting better. But in the US, there’s a divide on what should and shouldn’t be possible. Some states have fully embraced it while others are lagging behind, holding on to the skepticism that surrounds it. And for business owners, telemedicine can be an entirely new frontier worth pursuing.

    How Online Telemedicine Differs Per State

    Telehealth, or online medical consultation, has been a growing industry for decades, but it’s only recently that telemedicine is being integrated into the healthcare system at large. The Health Resources and Services Administration (HRSA) supported telehealth with $20 million in funding, and that number is expected to increase.

    When it comes to online medical consultation as a standalone business model though, things get more complicated. The laws governing online medical consultation differ per state; some states allow them while others don’t.

    States That Are Progressive with Online Telehealth Services

    These states have broad-use telehealth policies.

    • Alaska
    • Arizona
    • California
    • Colorado
    • Connecticut
    • Florida
    • Hawaii
    • Idaho
    • Maine
    • Minnesota
    • Missouri
    • Montana
    • Nebraska
    • New Jersey
    • New Mexico
    • Nevada
    • New York
    • Utah
    • Vermont
    • Washington

    States That Are Moderate with Online Telemedicine Services

    In these states, telemedicine laws and state Medicaid programs may come head-to-head. However, these states do promote telehealth services to consumers.

    • Alabama
    • D.C.
    • Delaware
    • Iowa
    • Illinois
    • Indiana
    • Kansas
    • Kentucky
    • Louisiana
    • Michigan
    • Mississippi
    • Oklahoma
    • Oregon
    • South Dakota
    • Tennessee
    • Virginia
    • Wisconsin
    • West Virginia
    • Wyoming

    States That Are Restrictive with Online Telehealth Services

    Here are the states you should probably avoid. Either the state law or the Medicaid service policies or both inhibit adoption of telehealth services.

    • Arkansas
    • Georgia
    • Massachusetts
    • Maryland
    • North Carolina
    • North Dakota
    • New Hampshire
    • Ohio
    • Pennsylvania
    • Rhode Island
    • South Carolina
    • Texas

    You can read all about each state right here or here.

    Summary of State Telehealth Regulations as of Jan 2022

    To sum everything up so you get a slightly more abbreviated vision of what the regulations are regarding telehealth in the US, here’s a quick list.

    • 43 out of 50 states have telehealth insurance for consumers
    • 30 of those 43 states protect consumers against paying more for online consultations or visits
    • 14 of those 43 states require payment parity
    • 3 of those 43 states don’t require health plans for virtual visits

    This quick summary should be able to help you in some ways narrow down your base offering to cover, at the very least, those 43 states and the District of Columbia. After that, you can get into the nitty gritty of changing up prices or availability of service depending on what you offer.

    What This Means for Your Telehealth Business

    Telemedicine is a growing industry, and it’s legal in 50 states, but that doesn’t mean it’s always easy to start a telehealth business or practice. The laws and regulations around telemedicine vary by state, so you need to do your research before getting into the business.

    There are many state and federal laws that come into play, including health insurance laws, private insurance, waivers, medicaid reimbursement policies, telehealth reimbursement policies, HIPAA privacy rules, and more. It may look like a regulator nightmare, but it’s worth it in the end. And once you set up properly, it will be easy to add and remove services as policies change.

    Hurdles When Starting Out

    Expense

    Telehealth can be an expensive business to start up, especially if you don’t have any capital to invest initially. The cost of setting up a company and offering health care provider services is high. You will need to purchase equipment so that you can see and speak with clients, as well as an office space where potential clients can visit.

    Insurance

    You also need plenty of professional indemnity insurance, which will protect you against any claims made against your business. This includes liability protection for clients and employees, as well as protection against lawsuits by other companies and individuals who claim patent infringement.

    Registration

    Another issue is getting registered with agencies such as Medicare and Medicaid. This can be difficult due to restrictions on how you deliver your services. You may need to register under multiple categories if you offer different services.

    Presence

    There are some states that require a healthcare professional to be physically present while doing telehealth consultations. This can be a deal breaker if you want to create a company that operates across state lines. While you can use technology to overcome this obstacle, there may be other potential issues with licensure or certification if you’re operating on a national level.

    Technology

    Before getting into business, verify what kinds of technology will be needed for your telehealth business. You should make sure that your equipment meets all necessary requirements and is in compliance with any applicable federal and state regulations.

    Rewards You’ll Reap

    Flexibility

    Many telemedicine jobs allow you to set your own schedule. This allows you to pursue other interests and focus on family as well.

    Virtuality

    Telemedicine businesses do not require a physical space for the practice of medicine. Most of your work can be done from home or any other place with Internet access.

    Profitability

    Telemedicine is still new, but the industry is growing rapidly, adding to its profit potential. A single telemedicine doctor can earn more than $150,000 annually.

    Future-Ready

    Telehealth is still emerging as a new type of medical visitation and prescription-giving that’s completely intertwined in the tech world. That’s the future we’re all heading for, and eventually the inevitable day will come where the world prefers to make virtual doctor’s visits. Your business will be ready for this day with a large customer base already, i.e., you’re way ahead of the competition.

    Why Starting a Telemedicine Business NOW Is Best

    Telemedicine is an essential part of healthcare. It allows doctors and patients to communicate with each other through modern technology, forming faster and easier doctor-patient relationships. This new service has been improving over time, and now it is very important in the medical world.

    Telemedicine allows the use of modern information technology to provide long-distance consultation between doctors and patients or specialists. This method of providing medical services helps people get the right treatment because they can use telecommunication devices to consult with specialists from all over the world.

    With the recent outbreaks of diseases such as COVID, that can spread through air contact and COVID contamination, it’s important to have a good network of doctors who can help with this situation. You can set up your own telemedicine business so people can get treatment from your doctors if they need it during a pandemic outbreak like COVID.

    Essentially, you provide a service that people all over the country, let alone the entire world, need and you make a killing off it. Win-win.

    A High-Risk Business Like Online Telemedicine Need High-Risk Payment Processing

    Telemedicine fee-for-service businesses are one example of when a high-risk merchant account is required than a standard business credit card processing account.

    Telemedicine companies provide healthcare services over the phone or internet to patients across the country. These transactions are often considered high risk because they are considered unusually complicated and businesses that offer telemedicine aren’t always equipped to handle transactions at their location.

    If you’re considering starting a telemedicine business, you need to apply for a credit card processing account for your business.

    DirectPayNet is a merchant services provider that will connect you with credit card payment processors and banks that will work with your business type. Don’t risk getting denied or shut down by typical 3rd-party providers. Contact us today to get started.

  • How to Speak to the Prepper Market

    How to Speak to the Prepper Market

    The prepper community is a market that has been growing for years. With the rise of doomsday-proof living, preppers are spending a lot of cash on goods and services that will help them survive an impending disaster. They shop at places like Costco and Sam’s Club, they buy tools and accessories online, and they are always looking for new solutions to problems they may face in the future.

    For businesses looking to profit off of this growing niche, it can be difficult to reach out and make a connection with these individuals. These days when everyone is bombarded with messages through email, text or social media, it can be hard to break through the noise. One way to get around this is by offering preppers something unique–and then using your marketing resources strategically to reach out to them.

    The Psychology of a Prepper

    Before you can even begin to sell something, you need to know who your audience is and why they need your product. Usually, it’s the reverse: you, as the merchant, are convincing your audience that they need your product. But for it to work, that demographic truly needs to find use in what you sell.

    Why do people become preppers?

    Trying to learn what to pack and how to prepare for extreme situations is a popular pastime for people who are fascinated by things like science fiction, disaster films, or military gear. Such people are called “preppers” and are always looking for new ideas about survival techniques for SHTF scenarios. And that doesn’t always mean something as violent or dramatic as a military invasion, it can also be along the lines of another great depression.

    But that’s surface-level prepper. Let’s ask another question. Why should anyone be prepared, whether it’s the apocalypse or a night at the movies with friends? The answer that can apply to any situation is: the fear of being left out or left behind. There’s a serious sense of self-worth that goes into play when talking about preppers. At the end of the world, who is worthy of remaining? When nothing else matters except life, itself, who should be at the frontline? A survivalist would tell you it’s them; the people who are prepared to survive through anything with survival skills they’ve been honing for years.

    Who are they?

    This is one of the toughest questions to answer when it comes to the American prepper community. The only two things that are consistent about them is the fact that they are preparing for future events and they value self-reliance. This preparation can be done for a number of different reasons including dealing with an economic collapse, natural disasters, or simply because they want to be self-reliant and not have to rely on society for their basic needs.

    Preppers can live in every city, state, country, and continent. They are independent of each other with just one true connection: survival.

    What’s in a prepper’s storage closet?

    Whether you’re selling these products within these categories or something else, it’s good to know the top things doomsday preppers keep in their bunkers or garages or homes.

    Food and water—the two most basic human needs. When you hoard emergency food with long shelf lives and water, you can survive any disaster without the food supply shortages typically seen in grocery stores.

    Water purification—if you don’t have access to clean drinking water from a faucet, tablets and water filters will come in handy, as well as water storage.

    Medical supplies—having a first aid kit with all of the necessary supplies like hand sanitizer and respirators to treat injuries will save lives in an emergency situation.

    Flashlights—stock up on flashlights with extra batteries as well as candles that can be used during power outages.

    Weapons—guns, knives, ammo, and other self-defense weapons help keep you and your stash protected from any threats.

    If you don’t sell emergency supplies in any of these categories directly, you could sell items that supplement these (e.g., toilet paper, duct tape) or spin your product in a way that sounds like one of the above 5 necessities. It’s about self-sufficiency above all.

    How to Sell to Preppers

    In order to sell to this group, you need to speak their language. You

    Tailor your marketing efforts to speak to their specific interests and needs. Even though you may already know what type of products they use, you might not be aware of other things that they want that you could sell them. Some preppers like to use solar panels and wind turbines while others prefer generators and propane heaters.

    While it’s important to focus on the things they like, make sure you also address any concerns they may have about their purchases. Listening to what others want is crucial if you want to succeed at marketing to this group. Make sure you ask them what they need and where else they look for products like yours. By talking with your target market, you can develop a strong relationship with them that leads to profits for you.

    Tips for Creating Ads

    Prepper marketing is a specific niche of marketing aimed at people who believe they need to be prepared for anything that may come their way. The prepper market covers a wide range of products ranging from seed banks and food storage, to bunkers and weapons. Preppers are typically characterized by stockpiling supplies and weapons in preparation for any potential disasters (floods, wildfires, tornadoes, etc.), threats, and pandemics (coronavirus). As with any marketing campaign, creating prepper ads that resonate with your audience is key to reaching your target demographic and getting them to purchase your product. Below are some tips on how you can create effective prepper ads:

    Create an online forum. This is a great way to interact with your audience via prepping forums or message boards on Facebook or other social networking sites where people can ask questions, share experiences, and give advice with others who share similar interests. This will be a crucial source to gather proper intel for your ad campaigns.

    Use visuals. Preppers are ready for anything and the visuals you use in your ads should speak to their emergency preparedness. They need to feel like you get what they’re thinking, where the world might be going, and what makes them feel most secure. Using the right visuals, you can reel in preppers of any socioeconomic background.

    Nail the CTA. The call-to-action at the end of your ad should be powerful and motivating. Every ad or post has some kind of CTA, usually in the form of “buy now”. Instead of being so generic, say something else that entices their anger or motivation to stay prepared. “Protect Your Property” and “Don’t Be the First Man Out” are a couple of examples that might do well for you.

    Challenges with Prepper Ad Approval

    Prepper advertising is often difficult to get approved by ad networks and social media sites because it can be controversial in nature. However, there are ways you can approach ads that are more likely to get approved by these networks.

    Social media platforms are infamous for censoring anything they consider offensive. It’s no surprise, then, that many prepper marketers find Facebook and Twitter to be unfriendly places when it comes to promoting their products and services.

    The most common reason for ad approval issues is that the images violate Facebook’s graphic guidelines as they relate to violence, nudity, and other potentially offensive content. Screenshots may be rejected if they show graphic content. The best way to avoid this is to not include any pictures in your ad that could be considered objectionable by the public.

    Ads for preppers also don’t fall within the belief system of mainstream media. In short, it’s scary. These platforms have already gone through so much backlash with what they promote that they don’t want to take this type of risk. The risk is creating fear among the public, creating extremist groups, and so forth. They are mitigating that risk by not allowing prepper-style promotion, point-blank.

    Preppers Are a High-Risk Demographic, Meaning You Need High-Risk Processing

    Everything about preppers is high-risk. From their demographic to their lifestyle to the products they buy, it’s all risky. Your only viable solution is to obtain a payment processor that can handle your high-risk business. With a high-risk merchant account, like the ones provided by DirectPayNet, you can get that level of payment processing necessary to meet the demand of this market.

    Preppers are also willing to pay top dollar for their survival needs. As most preppers are extremely concerned with safety and security, they are willing to invest in high quality products that will help them survive. However, there is a catch when selling to this market; you must be able to accept payment for your products. Cash, bank transfers, ACH, and more are highly preferable methods of payment for this group. They do use credit cards and debit cards, of course. But utilizing cash is one of the biggest things in the prepper industry, which means you need to accept that and money orders.

    With high-ticket products alongside typically high-risk products (i.e., weapons), your business requires a high-risk merchant account to succeed whether you’re selling to beginners or decades-long preppers.

    DirectPayNet is a merchant services provider who will get your business prepped to handle the demand of this demographic. Get in touch with us now and get your business prepped for the future.

  • Is Your PayPal Account Frozen? Here’s What You Need to Do to Get Your Funds

    Is Your PayPal Account Frozen? Here’s What You Need to Do to Get Your Funds

    There’s no doubt that PayPal is a convenient choice for businesses and shoppes, alike. The ability to store a mix of payment methods allows buyers to spend from any source, making the checkout process that much faster. And for businesses, it almost seems like a sure-fire way to receive payment. If a customer’s bank is empty, then PayPal simply uses another debit card, credit card, or bank account. And if that doesn’t cover it, the PayPal balance surely will. PayPal users get automated spending and businesses get funds.

    However, what happens when you grow your business, , revenue is high and sales are, too, but then one day you open up your backend shop page only to see that PayPal froze your account? As quickly as the service can build you up, they can tear you down. Here’s how to unfreeze your PayPal account as a merchant and recover your online store.

    PayPal Is NOT the Small Business Savior You Thought

    At the onset of its efforts to support small businesses and local sellers, PayPal seemed like the perfect solution. And for many businesses, it still is. If you can meet PayPal’s strict terms of use which limit transaction volume and available merchant categories, then it really might be a perfect solution for you. But for many sellers—especially those in high-risk industries—the service’s terms and conditions are no way to continue doing business.

    Why did PayPal freeze my account?

    Similar to Stripe, PayPal plays it safe when it comes to providing payment solutions to businesses. It isn’t a processor, it’s an aggregator. If you are curious about the details, go ahead and click this link to read more about processors versus aggregators. In short, PayPal does not provide you with a merchant account (or the freedom that comes with one). Instead, they allow you to operate under their own umbrella or master merchant account by giving you a sub-account.

    With that in mind, PayPal has to limit what they can offer to businesses operating under their umbrella account. They are restricted by their own agreements with the processors they work with, which means you suffer from those same restrictions.

    Specifically, the most common reasons PayPal freezes accounts because you:

    • Have an increase in transaction volume
    • Received a customer dispute
    • Received too many chargebacks or refund requests
    • Content on your site is against their user agreement
    • Violate PayPal’s usage terms
    • Account is unverified
    • Have low credit
    • Fraudulent activity is detected
    • You are too high of a risk

    And that last one is the real kicker. You’re too high of a risk to operate with PayPal. Some industries are associated with high chargeback ratios and fraud, which makes them high risk. Others simply see turbulent fluctuations in sales, where you see incredibly high sales over a few days with no sales in the following week. Or maybe you’re selling too much and hitting the invisible sales volume limit.

    There are also a slew of other reasons, including using multiple IP addresses to log into your account or having a large amount of money in your balance.

    Whatever the case may be, you are a risk to PayPal, so they act in seconds to shut you down to limit or halt that potential of risk.

    How do I know if PayPal froze my account?

    You’ll receive an email when PayPal decides to do its damage stating simply that your account is frozen with little to no detail. However, we all know there are infinite spam emails that comes from fake PayPals, so the real message might end up in your “junk” folder. If that’s the case, you won’t know your account is frozen until the next time you log into your account. Hopefully you do that often enough so sales aren’t affected too much.

    How long will my PayPal account be frozen for?

    180 days is the official period of time for which your account can be frozen, though it could easily be extended if PayPal wishes it so. That means if you do nothing, your funds will be stuck for 6 months.

    Steps to Unfreeze a Frozen PayPal Account

    There’s only one real way to unfreeze your account, but there are a couple options, thankfully, to keep your business operating. And to note, when PayPal freezes your account in the first place, it’s an automated algorithm that flags you, not a person.

    How do I unfreeze my PayPal account?

    When you open up PayPal and your account is frozen, you’ll be directed to the Resolution Center. On this page, the steps for reinstating your account are present. The most common steps include:

    • Proof of business – tax license and documents, utility bills, bank account information, DBA registration, etc.
    • Proof of shipping
    • Proof of identity – driver’s license, social security, passport, official state ID, etc.
    • Proof of product – name of your supplier and their contact information

    Send over the requested documentation they’ve requested and wait for the response; usually they at least inform you of receipt of documentation the following business day. Then, in the next days or so, you’ll be notified of their decision: either your account is reinstated, or it isn’t.

    If your account remains frozen, PayPal will tell you to wait 180 days to get your funds back. That is forever when it comes to doing business and will most likely see your store shut down for good. If this happens, you can call the PayPal customer support phone number and speak to a representative. It most likely won’t get your account back in order, but you might be able to provide additional documentation that will help your case. Be kind to the rep (it’s not their fault), and see where the conversation leads you. Unfortunately, not every business will get their funds back before that 6-month period.

    How can I continue doing business if my PayPal account is frozen?

    Great question. You absolutely can continue doing business in a few different ways.

    First, you can simply open up another PayPal account. As you know from opening the first one, there’s no underwriting process involved, so you can simply open another one up and avoid making the same “mistakes” as with the first account. This method is great in the short-term, but there’s a good chance you’ll get frozen again eventually. Use PayPal at your own risk.

    Second, you can open an account with another payment aggregator like Stripe or Square. They all work similarly, so applying is easy and you can get your shop running again within 24 hours. Again, this is short-term. If your business is getting flagged for something, you’re likely a high-risk seller and need a more permanent solution.

    Third, open a high-risk merchant account. Getting your own account allows you to operate freely, without invisible transaction volume caps or sudden account freezes. In fact, there are many benefits to getting a merchant account that you simply cannot get with a payment aggregator. The trade-off is that it takes about a week to open a merchant account, but it’s a long-term solution that actually works with your business type, not hinders it with account limitations.

    What do I do to get my money back from PayPal?

    So let’s say you take our advice and open up another account. While your store is running again and sales are possible, it doesn’t help the situation with the funds stuck in your previous account.

    Unfortunately, you’ll have to wait out the 180 days to get your money back. You can continue to call PayPal and speak with them about releasing the funds. A possible solution you can request is to have the funds released in installments. PayPal is keeping those funds on hold because of the risk of chargebacks and refunds that they would have to cover on your behalf if there were no funds in your account. So, what you can do is ask PayPal to release a portion of the funds each month until the balance is $0. You’ll eventually get your money back, PayPal will have the reserve they so desperately need, and in 6-months time you’ll never have to look at PayPal again after putting you through such hardship.

    Get a Long-Term Solution for Your Store’s Payment Processing Needs with a High-Risk Merchant Account

    Opening up a merchant account is the only undeniable way to keep your business running without the daily concern of having your account frozen or funds withheld. While it might be convenient to open up a PayPal account, very few businesses actually benefit from their terms and rates.

    Contact DirectPayNet to speak with one of our high-risk merchant account service reps to get the ultimate solution for your small business needs or to get help with your current PayPal predicament.

  • Expansion Part 2: Strategies for Maximizing Revenue When Expanding into New Markets

    Expansion Part 2: Strategies for Maximizing Revenue When Expanding into New Markets

    Business expansion into new markets is more than allowing your site to accept payments. We covered that in part one. To sum it up, you can add Dynamic Currency Conversion (DDC), open a Multi-Currency Merchant Account, or incorporate in the region.

    Now that you’ve prepped your store, how can you be sure of customer interest? And if customers in that region are already interested, how can you maximize that revenue? Here, in part two, we’ll cover some marketing strategies and growth strategies that maximize revenue when expanding your business into a new market.

    Determining Your Readiness for Market Expansion

    As we mentioned in part one, expansion isn’t right for every business. Some businesses aren’t yet ready for it and others might be perfectly situated in their current market. So, here’s how you can tell if your business is ready for expansion.

    You receive non-local traffic.

    A sure-fire way to determine whether your business is ready to expand into a new market is if you are already receiving traffic in that market. If you’ve got the traffic, you know there’s customer interest.

    Even if you don’t have traffic yet, expansion might still be a good idea for your business. You can do some market research to see if people are buying products similar to yours or in the same industry as your business. Never go in blind.

    You have the resources.

    Expanding can be a risk. Your business should have the financial resources to overcome any failed attempts—just in case. If you choose to incorporate in the new region, then you’ll want to be making at least $100k in that region. Incorporation is costly and not the best choice if doing so would eat a significant chunk out of what you’re making.

    Even if you don’t choose to incorporate, you should consider the cost of shipping (if you sell a physical item), translating your site, and customer service agents who speak the language of that region. These are just a few examples of what you’ll want to consider when expanding.

    You have the capacity to expand.

    Expansion takes time and effort. If you’re bogged down with sales, responding to current customers, or general business operations, then maybe it’s best to consider expansion when you’re a little more prepared. This isn’t just about money and funding the expansion, it’s about having the capacity to cater to the new area.

    You shouldn’t open up in a new location and ignore the new store. That sets you up to receive a bad reputation and even chargebacks. Instead, make the time or assign someone to take care of this endeavor properly.

    Expansion also isn’t typically appropriate for startups and similar types of business unless you know for a fact your products will sell. If you can ensure this, reach your target audience, and have the capacity to expand, then go for it.

    Strategies for Maximizing Revenue

    As a small business owner, you’ve decided that international expansion is right and your company is ready. Great! Once you get your payment processing situation sorted out, you can focus on how to maximize your revenue.

    Do the market research.

    See what people are buying, who’s buying it, and how they’re paying. Making your online store available in an area doesn’t mean people are going to flock to it, especially if you’re not selling or promoting the products they’re interested in. Instead, do some market research, build on trends, and have a marketing plan based on market analyses that matches your new business growth goals for the area.

    Use social media and content marketing.

    Social media platforms are great tools to determine the interest a particular demographic has for your brand. It will help you build some brand awareness, understand what customers respond to best in terms of products and advertising, and you can use it to see what similar successful businesses are doing in the area.

    If you’re expanding into a new market and there’s no competition, then social media can build up a community around your brand. You can use it to test what your followers like and cater to the demographic that responds best. And this is a good point: the demographic you sell most to in your local market may not be the same in another market. Don’t make assumptions; do the research and have a business plan/expansion strategy.

    Content marketing is a good way to drum up business and excitement as well. Newsletters, blogs, social media posts—these are all good, safe, and inexpensive ways to keep your new customers informed and aware.

    Raise the price of the product.

    The first two methods are pre-emptive strategies about understanding your customer base, connecting with them, and getting a feel for the landscape. Now we’re at the point of strategizing for maximum revenue by actively changing the price of your existing products in the market.

    Price test in different markets. It’s best to start high and decrease the price. As you might imagine, there is usually a more negative reaction when customers see a price hike, and you don’t want to scare off your existing customers at the possibility of gaining a few new ones. Instead, enter the market with higher prices and lower it according to customer reaction. Customers in certain regions are less price-sensitive than those in other regions, so price testing can help you maximize revenue.

    In part one we talked about currency accounts and incorporation. These two allow you to price test, DDC doesn’t. And raising your prices doesn’t necessarily mean doubling it. If you sell a new product in the states at 20USD, you could sell the same one in the UK for 20GBP.

    Take note that some regions require you to lower your prices, like a few in Europe. You don’t have to operate in those areas if you’re not getting any traffic, but be aware of requirements in the regions you do want to operate in.

    Offer the right payment methods.

    Buying with a credit card is hugely popular in North America, but that’s not true for every country or economic region. Customers in Germany, for example, prefer to use debit transactions. Some areas might want e-checks, ACH, or some other type of local payment method.

    Offer the payment methods that your target customers prefer. They’ll be more willing to make purchases on your site if they can use a mode they’re familiar with.

    Test your shopping cart.

    Have someone test your shopping cart in the new market. Maybe that means you hire someone, contact family or friends, or use a VPN—whatever it takes, just do it. If your shopping cart isn’t functioning properly, it will deter potential customers from making a purchase. Broken shopping carts make people think your site is attempting to commit some type of fraud and likely will never return to your store. You can avoid this by testing out your cart before making it available to the public.

    In the EU, for example, your payment gateway is required to have 3D Secure implemented. This is a process to verify the identity of the customer. Make sure you tidy up the checkout flow so it doesn’t disrupt the customer experience too much. Of course, people in the EU are used to taking this extra step, but you can still make it as pleasant as possible.

    Also test out delivery, if you’re delivering a physical product. Find out who makes these deliveries, provide a tracking number, and give an honest estimated arrival date. You’ll also want to figure out customs requirements.

    For digital goods, make sure customers can download the files or log in to your site. Some regions have regulations regarding site privacy and accessibility. Read up on this and implement what you have to in order to provide the best experience for your new customers.

    Translate your website.

    It’s as simple as that. Translate your website into your target market’s language. Customers will appreciate it and you’ll gain a lot more business simply because your site is readable. If it’s a market you’re really interested in, then don’t put up a fight about spending a little to have it translated properly (i.e., not just in Google Translate). Customers want to see that you understand their culture which they’ll respond positively to.

    Put Your Marketing Campaigns to Good Use with a Payment Processor Who Can Handle Expansion

    Your marketing efforts mean nothing if your shop can’t process the payment. Go back and read our part one, familiarize yourself with the options available, and work with a partner who can guide you through it all.

    Pricing, currency conversion, product delivery, shopping cart—it can all lead to chargebacks if you don’t spend some time catering to the customers in that new market. Don’t put your own business needs above the customer’s for the sake of profitability. With proper research, you’ll gain a competitive advantageincrease sales, and have a business model that works.

    The team here at DirectPayNet is well-versed in business expansion. Give us a call today and we’ll answer any questions you have as well as set you up with the right payment solution to scale your business.