It seems that for Indie developers, the fight never ends. As everyone is finally realising the strength of Crowdfunding through channels like Kickstarter or IndieGoGo, not everyone is happy to make it easy.
Paypal have withheld upto $60,000 of the $120,000 raised by developers hoping to remake Yatagarasu Attack on Cataclysm until the game has been completed and shipped...
Even though all of the crowdfunding sites make it quite clear that there is a risk to funding any projects, Paypal seems to be taking matters into their own hands. They are refusing to pay up to half of the funds promised by backers to the developers.
Naturally, this will cause huge issues with keeping development on track and on time, and could easily end up the same way the Skullgirls devs, Zero Lab Games, did; being unable to pay their staff during development.
Nyu Media commented on the issues:
“We appreciate irony as much as the next person, but PayPal refusing to provide funds legitimately raised to complete a game until after the game is released isn’t just beyond ridiculous – it potentially derails the game development”
If Paypal refuse to release the rest of the cash Nyu Media have said that they will refund all the Paypal payments, requesting that backers instead support the game's development via their own site. Nyu are worried that they won't get as many backers this time, potentially leading to a smaller development budget. To keep up to date, check out the IndieGoGo campaign here.
Do you think Paypal should be allowed to withhold funding from the devs? Or do the backers know what they're risking? Tell us your thoughts.