I needed that dollar.

December 12, 2006 9:14 AM

Why did PayPal take a dollar from my bank account?

I started a new PayPal personal account on Sunday, because getting my premier account downgraded so they didn't take extra fees looked like a pain. I have online Citibank checking and savings accounts; these two accounts are linked. I added the Citi savings account to my new PayPal account and did instant verification on PayPal. This means I entered my Citi username and password on the PayPal site and they connected to Citi to verify my account. That all worked and I received a payment on this PayPal account and transferred it out to my Citi account with no problems.

Except PayPal took one dollar from my Citi checking account, and I can't figure out why. As far as I can tell, nothing in the account creation or bank account verification documentation mentions a fee, and nothing about that transaction shows up in the history of either of my PayPal accounts. Documentation of the $1 debit on my Citi account shows that it happened right when I was creating the new PayPal account and before I received a payment.

I emailed PayPal help about this, but there's no response so far.

posted by thirteenkiller to work & money (14 comments total)

AFAIK, Paypal uses that dollar transaction to verify that the account used is real and yours.
posted by Memo at 9:20 AM on December 12, 2006

No, I don't think it's part of the verification process. As I recall, verification involved Paypal taking two small random amounts (£0.28 and £0.19) out and then asking me how much they had taken, to make sure I was the account owner. They then returned my hard-earned cash. There wouldn't be much in a verification process where the amount removed was always a dollar.

I also remember having to initiate the verification process on the Paypal site, rather than it being an automatic part of the signup process.

Doesn't Paypal require you to have at least $1 in your account all the time?
posted by Burger-Eating Invasion Monkey at 9:31 AM on December 12, 2006

I think I remember the process being slightly different when I signed up; they would deposit a random amount < $1 and you had to enter the two digit number (amount of cents) into a form.br>
Is that dollar apart of your paypal account (you can keep money not just in your bank, but in a bank-like paypal account)?
posted by JeremiahBritt at 9:33 AM on December 12, 2006

Burger-Eating Invasion Monkey - I recall that the verification process involved Paypal putting two small amounts *into* my account, and asking me what the amounts were. They didn't take anything.
posted by altolinguistic at 9:38 AM on December 12, 2006

You're right, altolinguistic.
posted by Burger-Eating Invasion Monkey at 9:39 AM on December 12, 2006

I don't know, but a similar thing happened to me that may be of interest. I purchased hosting on dreamhost the other day and elected to pay with my credit card via paypal (not an actual paypal account). Although I didn't comb through the terms of agreement, there was no notice on the page about paypal taking a fee out of my account for the transaction. When I submitted the payment, Dreamhost told me it could not verify - 3 times. Then, it finally verified the fourth time once my billing address matched my address on file exactly ("apartment 4" instead of "apt. #4"). I went to my online banking and saw that paypal had taken a dollar out each time I submitted the payment (4 times). I expected the dollars to come back, but alas they still have not.
posted by white light at 9:44 AM on December 12, 2006

To verify that you're the owner of the account, Paypal DEPOSITS two small amounts of money INTO your account. You then confirm the amount of money that they put in. Afterwards, I expect that they would WITHDRAW their money from your account.

Maybe the two amounts of money they deposited added up to one dollar?

I cant see Paypal just depositing money into people's accounts and not taking it out back.
posted by althanis at 9:44 AM on December 12, 2006

I used instant verification, which means the process of verification by two small deposits was bypassed.

Also, I don't think PayPal has any balance requirement, and that dollar doesn't seem to have been added to my PayPal balance anyway.
posted by thirteenkiller at 9:48 AM on December 12, 2006

When I opened a Paypal account I lived in Germany. They had to charge a dollar to my account, then I had to give them some ID number from the transaction. This was because somehow, Europeans were considered more risky than Americans.

They are a flaky bunch, IMO, who aren't as responsive as they should be. Perhaps if you burn the right color candle at 3am (or was that 2am?) you could invoke the Spirits and get some rational response from them.
posted by Goofyy at 10:03 AM on December 12, 2006

Did it really get taken out or is the $1 just on 'hold'? They could have done a test charge to verify the account was yours. The $1 charge will just drop from your account, and you'll still have your $1.

Lots of online places do this, usually it's a dollar. But sometimes its the entire amount of your purchase (so it seems like you got charged twice, though only one charge will go thru. This has made my rent check bounce more than once).
posted by misanthropicsarah at 10:41 AM on December 12, 2006

I'd say just wait and let Paypal get back to you about it. How long has it been since you contacted them? Or, if you're really panicked, you could always just call them.
posted by antifuse at 12:30 PM on December 12, 2006

None of these responders seems to have noticed that the problem is that Paypal did the verification on your CHECKING account instead of your SAVINGS account. Which means that future paypal purchases will probably go through checking.

I think you need to re-do the process to get your savings account linked to paypay, and don't do the instant verification this time.
posted by saffry at 3:37 PM on December 12, 2006

My experience is similar to Goofy's, and I'm in California. Also, I think PayPal didn't chargeback the amount, but credited my first purchase $1. (This was about one to 1.5 years ago.)
posted by MikeKD at 4:15 PM on December 12, 2006

I know Bank Of America recently upgraded their online credit card site. I used to only see posted transactions, now I see pending transactions too. This is annoying, because websites often put a hold for $1 to ensure that the credit card is real before actually charging the entire purchase, and it takes a few days for that hold to expire. BofA's site actually tells me which transactions are pending and which have posted. This has been happening for the last month or so; the pending ones for all charges that I didn't make have never posted and all eventually went away.
posted by david1230 at 7:18 PM on December 12, 2006