Paypal IPN

You may find that your Paypal Standard transactions do not change the status of the order to ‘processing’ even though Paypal says that the payment has been received. This is usually down to the enabling of ‘Instant Payment Notification (IPN)’, which should be automatically enabled in your Magento Paypal settings. To check that they are correctly configured in your Paypal settings you need to login to your Paypal account and go here:

My Account > Profile > Instant Payment Notification preferences

Once inside, click on ‘Edit IPN Settings’ and you’ll be shown the form below:

You need to enter your Magento store name followed by the Paypal IPN directory structure. If you do not have  URL rewrites enabled on the site, don’t forget to include /index.php before the Paypal folder, making it: http://www.storename.com/index.php/paypal/standard/ipn/

Then you need to enable it by selecting ‘Receive IPN messages’.

There’s a more comprehensive guide to enabling IPN on your Paypal Standard payments here: http://www.magentocommerce.com/wiki/how_to/paypal_standard_payments_setup_with_ipn