Not upheld: transaction handling, payment hold, customer service and communication complaint against PayPal UK Limited

Decision detail

Summary

Mrs S complained that PayPal placed a hold on a larger-than-usual transaction and did not communicate fairly about the refund process. PayPal stated the hold was due to the transaction size and a new device accessing the account, and provided an ARN code to help expedite the refund. Mrs S's bank did not recognise the code but helped her obtain a quicker refund anyway. PayPal offered £50 in goodwill compensation, later increasing the offer to £150 total. The ombudsman found PayPal acted reasonably within their User Agreement terms and did not treat Mrs S unfairly, declining to uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that PayPal had reasonable grounds to hold and review the transaction based on it being higher than usual and a new device accessing the account. The three to five working day refund timeframe was considered typical banking practice and not unreasonable. While the ARN code may not have functioned as Mrs S understood, she ultimately obtained a quicker refund by contacting her bank, so she did not lose out. The ombudsman noted that the FOS cannot force firms to change their processes or service standards, which is a matter for the Financial Conduct Authority.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website