R.I.P Paypal India

My mobile was buzzing that i got an email in morning. I was shocked and felt so bad to see that paypal almost made as a Dead Meat for Indian Users. No one expected this kind of surprise from paypal team once again after 6 months approximately. Ofcourse this is not the first time that paypal team have sent this kind of email. But this time, its not just tough for paypal users also for paypal. 170,000+ paypal user base is shaken once again by putting a limit of incoming and outgoing transaction, as well as restriction on Outside India Payments and Purchases.

As part of our commitment to provide a high level of customer service, we would like to give you a 30-day advance notice on changes to our user agreement for India.

With effect from 1 March 2011, you are required to comply with the requirements set out in the notification of the Reserve Bank of India governing the processing and settlement of export-related receipts facilitated by online payment gateways (“RBI Guidelines”).

In order to comply with the RBI Guidelines, our user agreement in India will be amended for the following services as follows:

  1. Any balance in and all future payments into your PayPal account may not be used to buy goods or services and must be transferred to your bank account in India within 7 days from the receipt of confirmation from the buyer in respect of the goods or services; and
  2. Export-related payments for goods and services into your PayPal account may not exceed US$500 per transaction.

We seek your understanding as we continue to employ our best efforts to comply with the RBI Guidelines in a timely manner.

We regret any inconvenience caused to you and hope the advance notice will enable you to plan your future use of our services accordingly. For further information, click here.

If you have any questions, please contact PayPal customer support by logging into your PayPal account and clicking on ‘contact us’ at the bottom of the page. We sincerely thank you for your patience and continued support.


The PayPal Team

Which means, users wont be able to pay their Web Hosting bills, Domain Booking and Renewals via paypal. It is not possible for everyone to own a credit card to do online transactions. So far we feel like its totally RBI who messes up the things when it comes to Paypal India users. No other country has this kind of limits over paypal accounts.

  • Why Paypal and RBI should ask for PAN number when it cannot track the transactions ?

We have to wait for the answer. Lets hope paypal solve this matter in near future.

About the Author: Robin C

Security Consultant, Engineer, Technology Enthusiast and Blogger.

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  1. I haven’t heard about anything related to this before. When did the conflict between PayPal and this RBI organization start? That has to REALLY hurt companies in the region.

  2. I am sorry to hear that bad news. This limitations really have bad impacts on online transactions. We hope there are other better solutions..

  3. Just thought to let you know, you mention in the end “No other country has this kind of limits over paypal accounts.”. Unfortunately this isn’t true, here in Egypt, the national bank has refused to work with Paypal, and so, Egyptians aren’t allowed to have Paypal accounts..

    I know its sad for you to have such limitations, but it seems that many countries are fighting Paypal for some reason…

    1. I agree bro. This problem is also there with some other countries as well. I thought that paypal and rbi has so many problems. but its everywhere.

      Hope to see some positive sign in near future that doesnt affect Small and Medium Business people.

  4. This is a great shock for all Indian’s who earn online. Not many Indian’s own a credit card. I don’t know why RBI is making such rules without a common sense. They are saying that this to prevent the flow of black money. But the fact is that big frauds will continue their work with other means and it is the noble people who are going to suffer.

  5. This is a pretty bad thing for them to have done. 170,000 member user base in India.. and they practically just throw it away.

    I’m not sure if India has them, but Liberty Reserve and AlertPay are some alternatives if you are looking.

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