SALLY SORTS IT: PayPal won’t let me access funds to cover food and vet bills for my cat rescue group

I am part of Uist Cat Rescue, a tiny, not-for-profit volunteer group helping feral cats. A previous member set up a PayPal account for us to receive donations and pay for food and litter. 

This worked fine until early 2023 when PayPal put a limitation on our account saying the rules had changed.

I started completing the information required on a link sent by PayPal to unlock the account. However, I got stuck at the point when asked if we are a registered charity or a business, as we are neither.

There is £1,825 in the account which I have asked for PayPal to refund if the limitation can’t be lifted but it won’t do it. Donations can’t be paid in either.

With huge vets’ bills and the need to feed our cats and kittens, we cannot afford to lose this money. Please help.

Cash kitty: A cat rescue group in the Outer Hebrides can’t access its paypal account to access badly needed funds

C.B., Outer Hebrides.

Sally Hamilton replies: You appealed to PayPal to scratch the restriction on the group’s account but, following several phone calls over many months, it remained in place.

To try to resolve matters, you said you put your own name on the account and provided ID in the form of your driving licence and a bank statement.

But that wasn’t enough, it seems, with PayPal then asking for ‘a letter of authorisation’. 

You said you believed this only applied to business customers. It was suggested over the phone to just authorise it yourself, but apparently that didn’t do the trick, either.

By the time you came to me, you were weary of the whole saga and you said if it could not be resolved soon, the group was within a whisker of having to cease its vital work. 

You said you have already had to put a temporary stop on rounding up ferals as you could not afford to feed any extra animals or get them neutered.

I examined the company’s website for possible answers, and found that non-profit organisations are perfectly able to use PayPal — and not just those that are registered charities. 

Anyone who wants to fundraise temporarily, perhaps because they are running a marathon for a good cause, often uses the service to take in and pay out money. I couldn’t quite see the issue with your arrangements.

However, I have had many complaints from readers, ranging from those who run small businesses to members of social clubs who have struggled with meeting banks’ and payment organisations’ increasingly stringent compliance rules and ‘know your customer’ obligations, as well as generally tighter security measures.

Compliance regulations require financial companies to check that customers are who they say they are and are designed to stamp out fraud, money laundering and other financial crime.

On my request, PayPal investigated what had gone wrong. After a bit of digging into your case, it seems that PayPal was struggling to confirm your identity — and this must be completed if a customer wants to hold a balance with the service. 

It then checked the documents you had sent, including a photo of your driving licence, and this time decided they did meet its requirements. It swiftly reopened the account.

A spokesman says: ‘We can confirm that recent documentation provided by the customer satisfies our compliance obligations. 

The limitation is now resolved and the customer can use the account normally. We acknowledge that this must have been a very frustrating experience and have issued a credit of £150 to the account as a goodwill gesture.’

You were thrilled at this news and welcomed the goodwill payment, which you say is enough to pay for a female cat to be spayed.

Insurer can’t find my new build home 

I recently moved house to a new-build property. I tried to change my address with my car insurer, Hedgehog, and it told me that it does not recognise it, so won’t offer cover.

This is despite it apparently recognising other addresses on the same development, including the next-door house, which was completed a few weeks before mine. Please can you help?

M.P., Leeds.

Sally Hamilton replies: You told me that your had already had an issue with insurer Hedgehog when it gave you just seven days’ notice to cancel your motor policy, which was bad enough but then it said you would have to pay a £60 charge for the privilege. I thought that pretty spineless.

Your new property is already registered with the Post Office and other insurance companies have given you quotes with no issue.

As a mum with two young children, and already struggling financially, you could do without the hassle and huge extra cost of shifting insurer. You need your car for work and dropping the children at nursery, so can’t give it up.

Your Hedgehog policy was priced at an affordable £394 for the year, which you were paying in monthly instalments, and was not due for renewal until May 2024. Once you started looking for an alternative you were shocked to find the lowest new quote was more than £800.

Motor premiums have been soaring in the past few months, which insurers are blaming on the rising cost of claims, driven largely by higher repair bills. While moving home can typically lead to premiums changing because different areas carry different risks in insurers’ eyes, I was surprised Hedgehog would not offer cover at all.

You have moved from Kent, where you had to park on the street, to a home in Leeds that has its own driveway, which is usually a more attractive proposition for insurers.

I asked Hedgehog, based in Gibraltar, to explain why it did not recognise your postcode. It told me it receives regular updates of new postcodes that then get loaded on to its system ready for rating. But before that it needs to carry out detailed analysis.

Like all insurers, it looks at various factors, such as accident and crime statistics in an area. It added that the lack of data for a new postcode can lead to a customer being declined for cover.

A Hedgehog spokesman said it was sorry to disappoint you but agreed to remove the £60 cancellation charge. You had no other option but to take the best quote you could find — £811 from Hastings Direct. Evidently, it has the ability to add new postcodes and rate them more swiftly than slower-moving Hedgehog.

• Write to Sally Hamilton at Sally Sorts It, Money Mail, Northcliffe House, 2 Derry Street, London W8 5TT or email sally@dailymail.co.uk — include phone number, address and a note addressed to the offending organisation giving them permission to talk to Sally Hamilton. Please do not send original documents as we cannot take responsibility for them. No legal responsibility can be accepted by the Daily Mail for answers given.