For what it's worth, my personal PayPal account, to which I accept "donations" for my work on jailbroken iPhones on my website, saurik.com, was recently restricted for what sounds like very solar reasons. Rather than getting angry and throwing a public fit, I calmly assumed that there was some reason this happened. I then called PayPal and had an hour long conversation with one of their representatives, during which I was not angry and asked for help. I explained the sitauation, explained my confusion, and explicitly asked what I could so in this situation to have similar functionality to what I had previously. It was determined that the main issue was that I was using the term "Donate", which carries particular meanings and connotations. After having a rational discussion of various options, including using a different part of PayPal to handle these "contributions", it was determined that I could provide a custom button image that used my own text, an option he didn't suggest immediately because most of their users, especially of this feature, have no technical knowledge. I then updated my website with this new wording, and the support guy put it back into the queue for me to have their appeals department recheck it. After the call, I sent an email to the support department's "kudos" address, explaining how wonderful working with this representative that morning was, without first waiting to see if I got the result I wanted: if I didn't, it certainly wasn't his fault. Later that day, my account was reactivated, and I have had no troubles since. (Note: typed on my iPhone, so please excuse some shortness and typos. ;P)
solar -> similar; so -> do; Also, it should be noted that my initial, personal reaction was one of frustration: "ugh, yet another thing I have to deal with today :(". However, that reaction doesn't make other people want to help you, so I repressed it. Also, I will admit I was slightly more flustered when they blocked my company account once and was requesting documentation that would be impossible to produce: in that case my personal reaction was anger. However, I again went through the same sequence of "that doesn't help", and then had multiple pleasant multiple-hour long conversations with some /epic/ support people who worked their asses off to help me. Being calm and rational, certainly being nice, is very important. I am going out of my way to say this because I do customer service myself, and when a customer ruins my day by yelling at me (or posting public vitriol over what was likely a misunderstanding) it becomes very difficult to be motivated to be helpful, and what you really want in those circumstances is more of an "above and beyond" response, which is unlikely to ever happen once you've sent the all-caps angry-mail. :(
Reading the mail he uploaded from PayPal, it sounds like this is the direct result of a Singaporean financial law. PayPal has to obey the laws in each country it operates in like any other business. If Singapore doesn't allow them to collect donations for non-charity organizations, then they can't. It is neither fair to blame PayPal for that nor to generalize it as a concerted effort to damage all open source projects.
This is the same kind of reaction people had when India blocked PayPal from operating normally (in terms of bank transfers) until it complied with some bank regulations there. Indians blamed PayPal when it was their own government creating the barriers.
You are probably right, and PayPal are probably opnly doing what they think they must.
However:
1. people are getting screwed when it's not really their fault
2. PayPal respond slowly and badly in cases like this
3. you can lose a lot of money with no recourse.
TANSTAAFL. Several groups I work with have repeatedly said they want the convenience of having people pay by using PayPal. I have now put together a standard response with the evidence of cases like this. I specifically require written confirmation that they, the customer, is stating that I must provide the PayPal option, and that they have read the documentation I provided.
FWIW, personally, I get people to send me a check or transfer money by BACS (direct bank-to-bank transfer). This is entirely within a single country, so it works.
