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There's been threads about people who have required a verified Paypal account to buy content on Steam. i personally can use an unverified Paypal, so it's not an objectional requirement.
i.e. Ensure this is open: http://i.imgur.com/4tbUYMq.png
How exactly do you verify your paypal? i have a bank account linked but not a credit card, surely that is enough?
It should be enough, as long as it's been confirmed.
What i see is something saying "This merchant doesn't accept non-instant bank payments. To continue with this purchase, please link a credit or debit card to your PayPal account."
And also an option telling me to add funds to my paypal balance, but i already have $51 in it
I took a look at one of the earlier threads: http://steamcommunity.com/discussions/forum/1/620713633843119218/
Seems to happen in a few other places too; or then it's something else than the geolocation.
R3LOAD from that thread is a member from 2010, so it surely isn't some 'new user' thing either. (Not that I thought it was, but wanted it out of the way.)