Amazon had Daniel Moore's $230,000 frozen, and he said that even after the money was released, his business was still struggling.
The policy was changed in response to a BBC story that said Amazon's actions nearly brought some businesses to ruin.
Some sellers were informed by Amazon that the temporary money holding will now be postponed until January 2024.
Early on Saturday morning, Amazon sent a seller an email stating: "We understand that the implementation of this policy on August 3 has resulted in a temporary cash-flow concern for your business. We have prolonged your policy transition until January 31, 2024 in order to help you with your preparations for the policy shift. The initial policy update from Amazon, distributed in May, said that it would hold seller payments temporarily to cover customer refund requests. It said that only from the delivery date plus an additional seven days will sellers be able to withdraw their money.
For merchants registered before August 2016, the rule went into effect on August 3 across the UK and the EU.
However, many EU and UK merchants did not notice Amazon's email regarding the change because it was frequently routed to their garbage bin on auto-pilot.
The move occurs at a time when businesses are having difficulty keeping up with rising living expenses, as well as rising energy, material, and operating prices.
The amount of Daniel Moore's earnings that Amazon had put on hold was "disproportionately high versus the potential refunds processed by customer returns or non-delivery," according to Moore.
The fact that hundreds of thousands of pounds of his earnings were frozen prevented him from paying his VAT payment on time or placing new stock orders.
Daniel said, he was informed on Saturday that all of his takings had been released, but that the income pause had caused problems throughout his whole supply chain, which may take up to two further weeks to fix.
Daniel said that the regulation "is still unfair" and that well-established merchants like his company Ink Jungle posed "no risk" to Amazon and shouldn't have "suffered a delay in payment" — particularly because he is accustomed to taking money every day.
FBA, or Fulfilled by Amazon, allows sellers to keep their inventory at Amazon's warehouse, and following a sale, Amazon will send the items to the buyer.
He was "happy" that he could now resume taking out money every day to run his firm on a daily basis.
But I can't rejoice because I don't believe in Amazon.
He remarked, "I'm still worried about the policy going into effect in January.
Whether corporations will be compensated for any damages incurred while their withdrawals were halted is not yet known.
According to Amazon, plenty of vendors now have access to money. A spokeswoman stated: "We are in touch with customers who have encountered a one-time cash flow issue and are listening to sellers' concerns.
The difficulties are comparable to those that Etsy vendors had after the platform started withholding 75% of their cash for about 45 days. Numerous vendors claimed that it was hurting their sales.