PayPal’s Pires says [...] reserves are typically 1% to 5% of PayPal sales, but can go as high as 20%. PayPal determines whether to require reserves based on risk associated with the type of product or service being sold, the merchant’s history of charge backs, and the length of time they’ve been PayPal sellers.
The furor from Paypal and Ebay merchants on this is pretty loud. Many merchants, with what sound like quite respectable records, are getting hit with 20% rolling reserves for 30-90 days. Making this relevant to our customers; I don't know a lot of car clubs that could deal with having 20-60% of the monies for an event held up for 30-90 days. Get the full story at BusinessWeek.com.
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