My paypal account has about £80 sitting in it from a few recently sold items, and i'm due to be invoiced for ebay fees. A couple of days later, I go to the bank to withdraw some cash and hey-ho, they have debited the fees from my bank balance via paypal, completely ignoring the money in my paypal account. When I buy online and pay via paypal, it always prioritises my paypal balance over my bank account, so why does ebay have to dip into my bank account? I've checked the settings in ebay and paypal, and can't find an option to make ebay prioritise my paypal balance. Am I missing something here, or do paypal/ebay just enjoy being a shower of cunts? Edit: I think I just answered my own question.
As long as it is in your Paypal account, it is their money to invest, think about it. Even if they just have it there for a few hours or days, they can work with the money. Therefore the more money in your pp account, the better for them.
I don't think Paypal can actually use the money like that since they aren't a bank/building society etc, just a financial service. Hence they charge a fee for transactions.
They are registered as a bank in Luxembourg. So, yes, they can and will. http://en.wikipedia.org/wiki/PayPal#Regulation
