My story about the massive registration of domains with paypal and Chinese
Briefly about yourself and the country - hoster / domain name registrar in Estonia, about 5% of the local domain market. A small company (three people). For an average firm in our country, 10 people are enough, and for a large one 50. More than half of firms contain 5 or less employees (the size of the firm will play a role). Speaking of domains, they mean .ee domains.
It all started unpretentiously. He lived, worked, sometimes repaired the primus. During the day, no more than 40-60 domains are registered throughout the country, 2-3 of them are mine. Plus hosting, renting servers.
The story began in December 2015. I woke up, came over, checked the mail. He wiped his eyes, - over the night, about 100 domains were ordered, all were paid by the Chinese through paypal, hieroglyphs through one, funny names. The first thought is fraud.
Checked, payment from different people, not withdrawn. Domain rules require additional checks, processed everything in a couple of hours. He began to look for, where did the activity come from and noticed that almost all the names are “two signs”. I note that for a long time the .ee domain was available only to “local”, the restriction was removed in the winter of 2015, and as a result, the joyful Chinese squatters unanimously made out the tasty. The next day, the number of orders increased, which became alarming.
')
The fact is that the sale price of a domain is 10 euro, the purchase price is 9. The profit from the sale through local banks is 1 euro, and the Chinese pay via paypal, they have no other possibility. Before them, 98% of payments went through local banks, 1% in cash and 1% other options (including paypal). Therefore, the loss on paypal did not interest me at all. They charge 34 cents + 5.4% for payments from China, simple arithmetic makes revenue from the sale of a single domain of 12 cents. When buying a dozen or two, the income rose to as much as 32 cents!
And the situation was aggravated by several factors:
1) Sale to the Chinese is not taxed, while I buy a domain with VAT. As a result, I buy it for 10.80, sell for 10. Of course, I can return the tax, but a couple of months later.
2) The turnover of the withdrawal of money from paypal had (and has) tight limits of 500 euro / day on the card and up to 10,000 per week by other methods.
3) Only two registrars in the country had a normal website in English and adequate paypal reception, so the entire burden fell on them.
4) During the night, the entire prepayment amount at the main registrar ended, the domains went to the queue and once one name was simultaneously ordered by 4 people at once. As a result, there were relatively many returns.
The turnover in the domains already exceeded 1000 euros per day and tended to grow.
The most interesting began a week later. Seeing the situation, I raised the price, but late ... the Chinese got a taste. Record - 1000+ domains per day. As a result, more than 5,000 domains were registered in 2 weeks. And I would happily drink mojito and counted the profit, if not for the news from paypal.
December 21 paypal said that he needed information on the basis of laws on money laundering. It does not matter, I thought, and provided all the documents. Although to be honest, it is not easy to find paper phone bills or a “bank statement” in an IT country.
December 22 paypal imposed restrictions on the fact that I will receive money in 21 days. Think about it - a small company, these days the turnover with paypal exceeded the annual salary fund. It is logical that I can not work under such conditions. Wrote them a request.
December 22 came the answer:
They claimed that I was “stupid” and my system was set up to sell goods, not services. And 21 days is needed for the client to get money back. I immediately wrote those. backed by paypal and received
December 23 answer:
In other words, the technicians disown. I wrote to paypal again, and hallelujah also called them! Bans removed. My joy knew no bounds. Victory. Began to withdraw money. But it turned out the cloud was ahead.
On December 27, a letter arrived and the account froze:
Also two different workers from paypal called and answered all the questions.
That day I canceled orders for 9000 euros. They were returned "from the frozen" money. Later, I realized that I did the right thing, for
December 28th . Key day. I received a letter from paypal:
In fact, they dial up and I did not hide. But worse is another. 14,448 euros frozen, 30% of the proceeds hold 90 days.
For a company of three people. The situation is three days before the new year. Catastrophe. It is good that I quickly found negotiable money for half a year (on credit).
Next was a series of requests and responses, here is one example:
April 7, 2016
Six months later I was able to get money from them. 30% for 90 days, they refuse to withdraw to this day. In total, turnover with paypal for December exceeded 50,000 euros. My minimum damage (due to credit, cancellation of orders and other things) is at least 4,000 euros, this is without “lost orders”, since on the hottest days I had to simply turn off their payment gateway.
I will add on my own - call them. Without a call, almost all letters fall into a black hole. And it is better not to use, if possible.
This is how paypal looks like with a limit:
Thanks for attention.
It all started unpretentiously. He lived, worked, sometimes repaired the primus. During the day, no more than 40-60 domains are registered throughout the country, 2-3 of them are mine. Plus hosting, renting servers.
The story began in December 2015. I woke up, came over, checked the mail. He wiped his eyes, - over the night, about 100 domains were ordered, all were paid by the Chinese through paypal, hieroglyphs through one, funny names. The first thought is fraud.
Checked, payment from different people, not withdrawn. Domain rules require additional checks, processed everything in a couple of hours. He began to look for, where did the activity come from and noticed that almost all the names are “two signs”. I note that for a long time the .ee domain was available only to “local”, the restriction was removed in the winter of 2015, and as a result, the joyful Chinese squatters unanimously made out the tasty. The next day, the number of orders increased, which became alarming.
')
The fact is that the sale price of a domain is 10 euro, the purchase price is 9. The profit from the sale through local banks is 1 euro, and the Chinese pay via paypal, they have no other possibility. Before them, 98% of payments went through local banks, 1% in cash and 1% other options (including paypal). Therefore, the loss on paypal did not interest me at all. They charge 34 cents + 5.4% for payments from China, simple arithmetic makes revenue from the sale of a single domain of 12 cents. When buying a dozen or two, the income rose to as much as 32 cents!
And the situation was aggravated by several factors:
1) Sale to the Chinese is not taxed, while I buy a domain with VAT. As a result, I buy it for 10.80, sell for 10. Of course, I can return the tax, but a couple of months later.
2) The turnover of the withdrawal of money from paypal had (and has) tight limits of 500 euro / day on the card and up to 10,000 per week by other methods.
3) Only two registrars in the country had a normal website in English and adequate paypal reception, so the entire burden fell on them.
4) During the night, the entire prepayment amount at the main registrar ended, the domains went to the queue and once one name was simultaneously ordered by 4 people at once. As a result, there were relatively many returns.
The turnover in the domains already exceeded 1000 euros per day and tended to grow.
The most interesting began a week later. Seeing the situation, I raised the price, but late ... the Chinese got a taste. Record - 1000+ domains per day. As a result, more than 5,000 domains were registered in 2 weeks. And I would happily drink mojito and counted the profit, if not for the news from paypal.
December 21 paypal said that he needed information on the basis of laws on money laundering. It does not matter, I thought, and provided all the documents. Although to be honest, it is not easy to find paper phone bills or a “bank statement” in an IT country.
December 22 paypal imposed restrictions on the fact that I will receive money in 21 days. Think about it - a small company, these days the turnover with paypal exceeded the annual salary fund. It is logical that I can not work under such conditions. Wrote them a request.
December 22 came the answer:
Dear Roman Ivanov,
Thank you for contacting
held on your paypal account.
You are selling a
service should not be held. The new
tangible goods.
After reviewing your transactions, we can see that
"Goods". As you are using a button on your website, this button
It is set up in order to mark the Goods, instead of
"Service"
program.
....
They claimed that I was “stupid” and my system was set up to sell goods, not services. And 21 days is needed for the client to get money back. I immediately wrote those. backed by paypal and received
December 23 answer:
thanks for contacting PayPal Technical Assistance.
Please note that there is no need to pay for a product or service.
In other words, the technicians disown. I wrote to paypal again, and hallelujah also called them! Bans removed. My joy knew no bounds. Victory. Began to withdraw money. But it turned out the cloud was ahead.
On December 27, a letter arrived and the account froze:
Dear Roman Ivanov,
We are a part of our commitment to buyers and sellers. We need to clarify your business activity. We have temporarily limited your account until you receive more information about your business.
Please contact us as soon as possible.
Business Model Information:
- what is the reason for the recent payments in payments received?
- specify the currency.
- Give a full description of the items sold or services provided.
- Provide the name of your main suppliers.
- physical store / showroom, website, etc ...
- Provide the terms and conditions of sale (refunds / cancellations).
- Do you offer weekly / monthly / yearly subscriptions?
- Provide a breakdown of the different options / products offered
- How long does it take to be delivered / completed?
- How is the service provided (venue / platform)?
Financial Information:
To make sure you can keep your company at the most recent level:
- Balance Sheet
- Profit and loss accounts
- Management accounts
- Audited accounts
- How can you check that the domain name is available?
- Why do you refund some transactions?
Also two different workers from paypal called and answered all the questions.
That day I canceled orders for 9000 euros. They were returned "from the frozen" money. Later, I realized that I did the right thing, for
December 28th . Key day. I received a letter from paypal:
Dear Roman Ivanov,
We tried to call you on 12/28/2015.
We’ve put you on the following account:
- Increase in volumes processed
If you’re on the payroll, you can’t charge it. But it is unavailable for use (including withdrawal).
The PayPal User Agreement, section 10.4.
Based on a review of your account, we will follow as follows:
- Rolling Reserve: for each day you will be able to keep it for a period of 90 minutes. This process will continue on a daily basis. This will be eligible for review 180 days from the date of this email.
- Collateral Reserve: € 14,448.26 EUR has been applied temporarily to your account. This amount will be eligible for review 90 days from the date of this email.
In fact, they dial up and I did not hide. But worse is another. 14,448 euros frozen, 30% of the proceeds hold 90 days.
For a company of three people. The situation is three days before the new year. Catastrophe. It is good that I quickly found negotiable money for half a year (on credit).
Next was a series of requests and responses, here is one example:
April 7, 2016
Dear Roman Ivanov,
Thank you for contacting PayPal
account.
We have conducted a full review.
analysis of your business model
After reviewing your account, we can’t approve what
for the following reasons:
If you contact PayPal 180 days from Dec / 25/2015 we'll conduct a review
of your reserve settings again.
Six months later I was able to get money from them. 30% for 90 days, they refuse to withdraw to this day. In total, turnover with paypal for December exceeded 50,000 euros. My minimum damage (due to credit, cancellation of orders and other things) is at least 4,000 euros, this is without “lost orders”, since on the hottest days I had to simply turn off their payment gateway.
I will add on my own - call them. Without a call, almost all letters fall into a black hole. And it is better not to use, if possible.
This is how paypal looks like with a limit:
Thanks for attention.
Source: https://habr.com/ru/post/369965/
All Articles