PayPal Payouts API - TRANSACTION_REFUSED Error (UNPROCESSABLE_ENTITY) During Order Authorization

I’m integrating PayPal Payouts into our application at Shipturtle, but I’m encountering a TRANSACTION_REFUSED error when trying to authorise an order. The error occurs when I make a POST request to the Payouts API. Below are the details of the issue, including the error response, code snippet, and steps I’ve tried.

Error Response:

{"name": "UNPROCESSABLE_ENTITY","details": [        {"issue": "TRANSACTION_REFUSED","description": "The request was refused"        }    ],"message": "The requested action could not be performed, semantically incorrect, or failed business validation.","debug_id": "348115ed2fa2f","links": [        {"href": "https://developer.paypal.com/api/rest/reference/orders/v2/errors/#TRANSACTION_REFUSED","rel": "information_link","method": "GET"        }    ]}

Code SnippetHere’s a simplified version of my Payouts API request (sensitive details omitted):

const requestBody = {  sender_batch_header: {    sender_batch_id: "batch_" + Math.random().toString(36).substring(9),    email_subject: "You have a payment",    email_message: "You received a payment. Thanks for using our service!"  },  items: [    {      recipient_type: "EMAIL",      amount: {        value: "10.00",        currency: "USD"      },      receiver: "recipient@example.com",      note: "Payment for services",      sender_item_id: "item_" + Math.random().toString(36).substring(9)    }  ]};fetch('https://api.paypal.com/v1/payments/payouts', {  method: 'POST',  headers: {'Content-Type': 'application/json','Authorization': 'Bearer <ACCESS_TOKEN>','PayPal-Request-Id': 'request_'+ Math.random().toString(36).substring(9)  },  body: JSON.stringify(requestBody)}).then(response => response.json()).then(data => console.log(data)).catch(error => console.error('Error:', error));

What I’ve Tried:

1. Verified Account Status:
   • Confirmed my PayPal account has sufficient funds (more than $10.00 USD to cover the payout and fees).
   • Ensured the recipient’s email is associated with a verified PayPal account in a supported country.
   • Checked that my account is authorized for Payouts (applied and approved by PayPal).
2. Checked API Request:
   • Validated the request body against PayPal’s Payouts API documentation.
   • Ensured the sender_batch_id and sender_item_id are unique.
   • Used a valid access token with the correct scope.
3. Reviewed Documentation:
   • Followed the Payouts integration guide (https://developer.paypal.com/docs/payouts/).
   • Checked the error link provided (https://developer.paypal.com/api/rest/reference/orders/v2/errors/#TRANSACTION_REFUSED), but it lacks specific guidance for Payouts.
4. Other Checks:
   • Tried a smaller payout amount ($1.00 USD) to rule out risk flags.
   • Contacted PayPal Merchant Technical Support with the debug ID (348115ed2fa2f), but awaiting a detailed response.

Questions:

• What could be causing the TRANSACTION_REFUSED error in production?
• Are there specific account settings or permissions I might be missing for Payouts?
• Could this be related to risk/compliance checks, and how can I debug those?
• Any suggestions for additional logging or checks to pinpoint the issue?

Environment

• API: PayPal Payouts API (v1)
• PayPal Account: Business, US-based, Payouts enabled

Any insights or solutions would be greatly appreciated! Let me know if you need more details about the request or response.