***** FIX / SOLUTION *****
PROBLEM: You have a balance in your PayPal account but are seemingly unable to use it to make purchases on eBay. The only options you may have is a linked credit card or bank account.
FIX: You need to change your Primary Currency in your PayPal account settings to the country you reside! Click “PayPal Balance”> “Manage Currencies”> select your currency, add that currency and make it primary. Once this is done you may need to re-login to your eBay account for the settings to take effect. But you should now have PayPal Balance as a payment option.
Explanation: I live in Canada (CAD) and make a lot of purchases from the United States (US). My balance was in US and Primary Currency was set as US and it would make sense that the things I’m buying are in US so no problem right? Wrong lol I could not use it until I changed my currency to CAD first. Doing it like this effectively means PayPal will **bleep** me on the exchange rate, because it now has to go from US to CAD and to US again. But at least I can use the funds in my account. The other option is to transfer your balance to your credit card or bank and then make a purchase from either. I’m sure the argument is that country’s have business restrictions or some such nonsense. But thats just how it is.
NOTE: This problem should only affect folks who are attempting to make a payment in a currency that is not the same as the country with which they reside. It’s pretty sad that the PayPal service reps have not given a straight answer for this simple problem. But there you go folks!