Regretsy, the “fail blog of hand crafts,” recently notified users that it wouldn’t be able to give donations as part of its Christmas gift fund-raising effort because the program ran afoul of payment service PayPal’s terms of service. Regretsy explained the fallout in a lengthy, occasionally profane blog post, casting PayPal in an unfavorable light – inflexible, humorless, bureaucratic and – during the Christmas-season, positively Scrooge-like in its behavior:

Apparently we made the mistake of using the “Donate” button, which Paypal is now claiming is only for nonprofit organizations to use. They froze the account, which also includes Zazzle money that we use to make emergency gifts. That money isn’t in issue, but what the hell! Might as well keep everything!

Following the predictable howls of outrage from the assembled throngs, PayPal has reversed course. In a blog post entitled, “Regretsy Issue Resolution,” PayPal director of communications Anuj Nayar explained that PayPal has released the funds it had held and was trying to work with Regretsy to make a donation to help their cause:

We appreciate that this can be an inconvenience, but we have a responsibility to all our customers – both donors and recipients; and buyers and sellers. In this instance, we recognized our error and moved as swiftly as possible to fix it.