Consumer complaint received 2018-06-01
Company: Paypal Holdings, Inc
State: NY
Product: Money transfer, virtual currency, or money service
Sub-product: Mobile or digital wallet
Issue: Confusing or misleading advertising or marketing

Complaint:
Imagine going to a store with a {$20.00} bill and a credit card in your wallet. Your total comes to {$16.00} and you give the cashier your credit card, because the purchase is a business purchase and your credit card is a business card. Instead, the cashier notices you have {$20.00} in your wallet and yanks the {$20.00} from your wallet to complete the purchase. 

This is what PayPal has become. At best, it is deceptive ; at worst, it is theft. 

I am a PayPal customer since XX/XX/XXXX. I have always enjoyed using PayPal to select which payment method I want to use at various online retailers. However, on XX/XX/XXXX, I purchased a ticket for {$16.00} with XXXX  XXXX and used PayPal to complete the transaction. The transaction ID was XXXX. PayPal asked how I would like to pay for the transaction, and I chose my XXXX XXXX card ending in XXXX ( see attached screenshot ). This is also my default card, or " preferred way to pay '', as PayPal puts it ( see attached screenshot ). However, after selecting this card, PayPal ignored the payment method indicated at checkout and instead deducted the {$16.00} from my PayPal balance, because at the time of the transaction, I had funds in my PayPal balance that had not yet been transferred to my XXXX checking account. 

PayPal 's customer service confirmed that in the event there are funds in your XXXX balance, any credit cards selected at check out will be ignored, and your XXXX balance will be used, even if the credit card is selected as your default payment method. 

There are many reasons why a consumer may wish to place a purchase on a specific credit card, rather than using cash ( or PayPal funds, which is the equivalent of cash ), including, but not limited to : 1 ) the transaction may be a business purchase, and must be placed on a business card ; 2 ) the credit card selected by the consumer at checkout may offer specific rewards for the purchase ; 3 ) the consumer may need to save the PayPal funds ( the equivalent of cash ) in order to pay for goods or services that do not accept credit card as a method of payment, such as rent, mortgage, etc. ; 4 ) the credit card  selected may offer purchase or travel protections that are not offered by PayPal. 

A dispute filed with PayPal regarding this transaction ( namely, dispute ID number XXXX ) was denied because my dispute is not with the merchant ( XXXX  XXXX ) but rather with PayPal itself. 

It is unacceptable, deceptive, and borderline theft for PayPal to withdraw funds from my account when I have indicated that a particular purchase is to be charged to a particular credit card. 

PayPal is making online purchases more difficult than they need to be. The front page of PayPal.com advertises ( see attached screenshot ) that " With PayPal, you can pay your way '' and " Add credit, debit, and bank accounts to your digit wallet and take your pick at check out. '' These statements are false, as evidenced by my situation described above.

Company response to consumer: Closed with monetary relief