Internet Rages over PayPal Ruining Poor Kids' Christmas

Take a much-loathed corporation, add poor kids, Christmas, and a popular blog, and you've got the recipe for a perfect Internet Shit Storm. Paypal is being blasted for "stealing" money raised for Christmas presents for poor kids.

The popular Etsy gag blog,Regretsy, did a very nice thing and launched a charity drive for poor kids, getting users to donate money to buy over 200 kids Christmas presents. They raised thousands of dollars, but say they made one small mistake: Using the a "Donate" button provided by Paypal to solicit donaaaaaaations instead of a "Buy" button.

Now Paypal claims they can't process the payments because Regretsy is a for-profit corporation and the "Donate," button is for non-profits. Regretsy called out PayPal in a couple blog posts has been forced to manually refund all its readers' donations, PayPal keeps the transaction fee, poor kids are bereft, and the internet is raging.

And it is it raging. Crusading nerds have voted the story to the front page of Reddit and Hacker News. Every tech blog has weighed in with their own Grinch reference. People are canceling their accounts!

Some have pointed out, pretty convincingly, actually, that PayPal maybe be trying to cut down on legitimate legal exposure. Charity law is complex, and third-party donations are a tricky thing, ripe with scammers. But, still, it seems PayPal could work out an arrangement with a long-standing customer that would at least refund their users' transaction fees.

PayPal hasn't received such hate since it cut off payments to Wikileaks last year. But that was just a dumb news organization. These are kids! And Christmas. PayPal may not be long for this world. The only people who win in this situation is Regretsy, which has gained an enormous burst of publicity no amount of hassle could outweigh.

Update: Christmas is saved! PayPal says they made a mistake, has unfrozen Regretsy's donations and is making a donation as an apology.

[Image via Shutterstock]