You can find the proposal as Proposal 7 on PayPal's 2023 proxy statement, here.

Why It Matters:

In June 2021, the American Civil Liberties Union (ACLU) launched a campaign calling on PayPal to provide nondiscriminatory financial services to all users. This is important because PayPal has a history of closing individual and business accounts without giving
meaningful notice about the particular Terms of Services provision that was violated. ACLU contends that accountability on human rights, civil liberties, and sound technology policy necessitates that PayPal provide transparency to its users, enabling them to appeal PayPal’s decision to close their account in a timely and efficient manner.

There have also been reports that PayPal blocks accounts of sex workers, which has been shown to disproportionately harm Black, Brown and trans communities. Additionally, PayPal has routinely targeted users for speech protected by the First Amendment. The Company has stalled efforts to provide bail support to protestors, froze the accounts
of News Media Canada for a payment to submit an article about Syrian refugees for an award and terminated service to a user for using an open-source software that enables anonymous communication. Investors have reason to be concerned because, as the Electronic Frontier Foundation notes, few companies dominate the market for online payment processing.

PayPal wields tremendous power in the industry and controls the speech environment by turning off financial faucet for users who express disfavored views or discuss controversial topics. Consequently, this leaves individuals who have been blacklisted by PayPal in financially precarious situations since PayPal is one of the largest payment platforms in the world with 325 million active users. As such, any arguments that those dissatisfied with PayPal’s terms and conditions should seek alternative payment methods are not convincing.

Further, PayPal’s 2021 Global Impact Report failed to include information relating to account suspension or actions that may hinder free speech, undermining its commitment to “build a digital economy that powers a more inclusive and resilient world”. Indeed, this
emphasises the contradiction between PayPal’s human rights policy, account suspensions and other potential violations of free speech.

By not being transparent with its users, PayPal is missing out on the opportunity to service these users, which is discriminatory, but also hinders PayPal’s ability to acquire a greater market share and generate revenue.