PayPal Holdings Inc. has no intention of fining customers for spreading "misinformation," Bloomberg News reported on Monday, after a new user agreement outlining such a plan from the digital payments giant met with strong backlash.

PayPal published policy updates prohibiting customers from using its services for activities identified by it as "sending, posting, or publication of any messages, content, or materials" promoting misinformation, the report said, citing a statement from the company.

The new policy was supposed to go into effect on Nov. 3, threatening a penalty of $2,500 on customers for each violation, the report added.

Shares of PayPal were down nearly 5.1%.

PayPal's former president David Marcus slammed the policy in a tweet on Saturday, saying the new policy "goes against everything I believe in."

"A private company now gets to decide to take your money if you say something they disagree with. Insanity" Marcus tweeted.

Elon Musk, the billionaire Tesla Inc. chief who co-founded PayPal, tweeted "Agreed," replying to Marcus's tweet.

PayPal did not immediately respond to a Reuters request for comment.