PayPal to restrict payments to Indian merchants from 1st March

Frequently Asked Questions:

Q: Why will PayPal not allow me to receive more than US$500?

Starting 1 March, 2011, PayPal customers in India will not be allowed to receive payments for any export-related goods or services for an amount exceeding US$500 per transaction. This change is to ensure that we continue to comply with the RBI Guidelines.

Q: Why will PayPal not allow me to keep money in my PayPal balance?

Starting 1 March, 2011, PayPal customers in India will not be able to keep money in their PayPal account balance. Instead, all money received into a PayPal account must be transferred to a customer's India bank account within 7 days from the receipt of confirmation from the buyer in respect of the good or services. This change is to ensure that we continue to comply with the RBI Guidelines.

Q: Will my customers be able to complete their checkout with their PayPal account balance?

We're glad that you offer PayPal to your customers. Unfortunately, we will not allow customers in India to send money from their PayPal account balance starting 1 March, 2011. This means that your customers will need to link a credit card to their account in before sending you money with PayPal. This change is to ensure that we continue to comply with the RBI Guidelines.

Q: The customers on my website are not able to complete purchase or pay via PayPal. Why?

Starting 1 March, 2011, PayPal customers in India will not be allowed to receive payments for any export-related goods or services for an amount exceeding US$500 per transaction. If you are listing products greater than US$500 per transaction then you may need to seek alternative methods of payment. This change is to ensure that we continue to comply with the RBI Guidelines.

Q: What is meant by receipt of confirmation from the buyer in respect of goods and services?

As an exporter of products or services abroad, you need to ensure that your buyer has received the product or services as per specifications set out on your website. As an exporter of goods, you may withdraw the balance to your bank account in India upon reasonable consideration of shipping time and other clearances such as excise and customs for the destination country. As an exporter of services, you may withdraw the balance to your bank account in India upon receipt of payment from your buyer into your PayPal account.

Source: https://www.paypal-apac.com/india/

What's with Paypal and the Indian Government? Didn't they have similar problems which was resolved some months back?

The poor Indian freelancers are going to have a tough time with these new restrictions in place.

The worst part is they won't be able to use Paypal balance and will have to use their credit card and be charged extra fees for using the credit card + currency conversion fees by the banks.

Hope they come up with a solution or an alternative soon.

No new updates from paypal so far. The only solution now is to get a credit card, transfer the money and do all transactions using the credit card.

you must be glad that PayPal used to work in your country because in mine it didnt...the only way for me to have a PayPal account is to have a credit card on inrernational bank

What is the exact fuss about?

1. Paypal Limit of $500 per transaction - If a Publisher earns $500-$1000, he can set the minimum payout to $400 which is below ' $500 limit ' for Paypal. So, that way he can get the total amount in 3-4 transactions.

so what are the alternatives for Indian merchants?

thanks for sharing this

I lost my money last time i did transaction on moneypackers. Paypal was the only alternate for me to do safe transaction. Its a bad news that PayPal is restricting payments to Indian merchants from 1st March

Originally Posted by henryjurk

I lost my money last time i did transaction on moneypackers. Paypal was the only alternate for me to do safe transaction. Its a bad news that PayPal is restricting payments to Indian merchants from 1st March

You were posting in 9th month and this news is about 3rd month of the year and you have already mentioned the date also, So please do post sensibly.
About Paypal restriction they have lifted a lot of restriction already recently from the Indian users. Maybe in future it will back on track soon.