Why are my PayPal payments on-hold?

We have gotten some tickets from store owners, asking us why their incoming PayPal payments are on-hold. We do not yet have full picture. But this is what we know currently. We have been aware of this since ~15 January, 2021.

This is what we see

Some store owners did not get their commands & payment processed instantly, they would have to go to their PayPal dashboard, and manually confirm that the payment was done, and that it's a "digital goods" payment. It seems to only affect a small amount of users on our platform. Our own PayPal account that we use for internal store upgrades (Bronze -> Silver plan upgrades for example), that uses the same method of processing payments, is not affected. So the issue is not our integration, it seems to be some kind of policy change.

Why is this happening?

We asked some of the users that created these tickets with us, to ask PayPal (as we do not have the issue, we were not able to do so). They response most store owners have gotten was something like; "Please make sure that you keep receiving regular payments, and that you build a good seller history. And the holds will go away.". So if your account gets regular payments (like ours for example) and does not have a lot of chargebacks, then you are in "Good seller" status, and these checks wont happen. This does seem correct, as we do get regular payments to our platform for internal upgrades, and we don't have a lot of chargebacks. Thus our account is in "Good seller" status, and did not get any "on-hold" notifications during the last few weeks.

What can I do?

The best thing you can do at the moment is keep using PayPal, make sure that you are not getting a lot of chargebacks, and with time, you'll receive the "Good seller" status internally at PayPal, so they no longer mark your payments as "On-hold" for a review.

Also, when you enter the requested details at PayPal, you should have your money within 21 days. Its also a good idea to let your buyer do the same thing, so PayPal know that the payment is legitimate.

What can CraftingStore do?

At this moment, there seems to be nothing we can do, its purely a check on PayPal's end, and this is unfortunately something that we have no control over.

Looking at how many tickets we got (about 10 - In two weeks) and how many PayPal payments we process during a day (1500+ at least). It seems to be pretty limited, and most stores don't seem to be affected.