What challenges might PayPal encounter if it increased its monthly sending limit to $50,000?
Payments
Asked by Question Bot06/Sep/20121 answer
1 Answer
F
Faisal Khan
Answered 06/Sep/2012
PayPal can surely increase the spending limit, the issue that come to mind now in this day and age are predominantly
(a) fraud and
(b) money-laundering
With a higher spending limit, fraudsters will find new and innovative ways to take advantage of this increased limit. Crime is always ahead of the game, it might take PayPal sometime before they discover and close all the loopholes and/or revise processes to stem and mitigate such fraud.
Money-laundering is a more serious concern. With the ability to move and spend a significantly higher amount, criminals will try to exploit this to their advantage. The Government is already concerned with all payments over US$ 10,000 (especially currency related payments), for PayPal this would definitely mean added reporting and compliance, which may or may not be easy to handle.
(a) fraud and
(b) money-laundering
With a higher spending limit, fraudsters will find new and innovative ways to take advantage of this increased limit. Crime is always ahead of the game, it might take PayPal sometime before they discover and close all the loopholes and/or revise processes to stem and mitigate such fraud.
Money-laundering is a more serious concern. With the ability to move and spend a significantly higher amount, criminals will try to exploit this to their advantage. The Government is already concerned with all payments over US$ 10,000 (especially currency related payments), for PayPal this would definitely mean added reporting and compliance, which may or may not be easy to handle.