09/01/2025

PayPal Says German Payment Disruption Resolved After Banks Halt €10 Billion

Finance Feeds

PayPal said on Friday it was working to clear up remaining account discrepancies after a widespread outage in Germany led local banks to block billions of euros in transactions, raising concerns about the reliability of one of the country’s most popular payment apps.

“We apologise for the inconvenience caused by the current events. Safety remains our top priority,” the U.S.-based company said in an emailed statement, adding that the disruption had been resolved. PayPal said it was coordinating with its banking partners to ensure all legitimate merchant transactions were fully credited.

German Banks Halted Billions in Payments

The disruption erupted on August 27, when German lenders, including DZ Bank and BayernLB, froze more than €10 billion ($11.7 billion) worth of payments after identifying millions of suspicious direct debits linked to PayPal, according to reports in Sueddeutsche Zeitung. The newspaper said PayPal’s security system, normally used to vet transactions for fraud, had stopped functioning, resulting in unverified debits being sent through.

Germany’s Savings Banks and Giro Association, representing more than 300 institutions, confirmed that unauthorized transactions had caused widespread disruption to payments across Europe, particularly in Germany. The group said Sparkasse customers saw services return to normal by August 26 and that regulators had been informed.