Many remodelers and other small businesses use PayPal to let their clients pay online. Today, the Consumer Financial Protection Bureau alleges that the company has been using deceptive advertising for their credit services.
According to The Washington Post, consumers using PayPal were “unknowingly signed up for credit lines and promised discounts and payment options they never received.”
The confusion came after PayPal rebranded its “Bill me later” service to PayPal Credit. Consumers newly enrolled for a regular PayPal account didn’t realize they were signed up for credit with the company, and according to CFPB Director Richard Cordray, “many people ended up enrolled without knowing how or why, only to discover unexpectedly they had an account.”
The agency wants PayPal to pay $25 million for the actions, which includes $5 million in refunds for consumers and a $10 million penalty.
The Washington Post has the full report.