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PayPal Updates its Calling 'Terms of Service' Again

July 06, 2015
By Casey Houser - Contributing Writer

PayPal (News - Alert) recently updated its terms of service to include language that suggested it has the power to complete robocalls (automated voice calls and texts) at will. Industry reports noted that this made many consumers nervous, but a more recent change in language, two days before the updated rules were to be published, cleared up some confusion about when PayPal intends to take action with that sort of power.

A story at Engadget says PayPal initially included text in its terms and services that made it sound like the company would be able to spam users with calls and texts about how to purchase goods with its online wallet. However, that is not the path the company said it wants to take as given evidence by a change to that language. The change states the online payment provider will only connect with users through automated calls when PayPal needs to collect debt from them or warn them about fraudulent practices.

The Washington Post further showed that users will have to provide PayPal with consent about whether or not they would like to accept automated calls. The overall theme is that PayPal says it wants to protect its customers -- not spam them. The company noted in a blog post of its own that it has been working with regulators to make sure that customer protection is the top priority.

“We have also been working proactively with regulators to clarify that our focus is on our customers, on consumer protection, and on doing the right thing,” PayPal said. “We appreciate the feedback our customers have provided to us on this issue and apologize for any confusion we may have caused.”

A bigger issue tied to this confusion, though, comes from recent actions the Federal Communications Commission (FCC (News - Alert)) has taken to further regulate robocalling. TMC reported last week that the FCC is tightening its grip on call centers through a more strict interpretation of the Telephone Consumer Protection Act. In brief, an FCC ruling made it clear that consumers must have the option to opt out of unwanted calling. It also cracked down on the use of autodialers which can operate in conjunction with computerized calls and texts.

PayPal's change here may seek to place its customers first, but it also may protect PayPal from the ire of the FCC. Travis LeBlanc, the enforcement bureau chief at the FCC, commended PayPal for making these last-minute revisions which will make it easier for consumers to assert their preferences while continuing to allow for robocalling in times that PayPal has deemed appropriate.