So PayPal Practically Screws Indians Again

If you want to get behind the history of me and PayPal, you better head over and read this older post rant of mine. PayPal has been and is being screwing people in India because they basically cannot adhere to standards laid down by the Reserve Bank of India.

In a recent email sent out to PayPal users in India, they have said that they will be laying down new rules for Indian users starting from March 1st, 2011. Here are some of the highlights, you can read the rest here.

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.

So PayPal is practically telling Indian users that they cannot buy anything from their money in PayPal and instead have to use their "f*cked up" exchange rates so that you lose money and then pay a "premium" on exchange rate conversions when you buy things from out of the country.

In addition to that they are telling developers and web designers that you cannot earn more than $500 per transaction. Now try explaining to your clients that they will need to take the effort to send you money in multiple transactions.

Alright, I am not going to go on with this humbug, please continue for me in the comments.

Please don’t blame the Reserve Bank of India (RBI) for this. For the record, here are the FEMA regulations (Foreign Exchange Management Act, 1999)  which clearly state how businesses like PayPal should operate in India, and PayPal is definitely one of the biggest violators of it.

More PayPal shenanigans at their official blog. At least they didn’t f*ck royally when it comes to intimating users.

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Keith Dsouza

I am the editor-in-chief and owner of Techie Buzz. I love coding and have contributed to several open source projects in the past. You can know more about me and my projects by visiting my Personal Website.I am also a social networking enthusiast and can be found active on twitter, you can follow Keith on twitter @keithdsouza. You can click on my name to visit my Google+ profile.

  • no more domain renewals? no more hosting payments or service payments?

    The only people who can now spend thru paypal are people with credit cards? WHAT THE F . . . . .

    this is what happens when you spend time behind smaller leaks than those hiding in the swiss banks . . . .this is so frustrating.

  • rock

    do they mean that if we recieve money into our paypal its compulsory to deposit that money into bank within 7 days or we lose that money , i dont understand this

  • screwd

    I think this is the effect on indian people for pressurizing the Govt to reveal black money details of the creamy layer….

  • Mandela

    Paypal is getting worse and worse for Indian users to the point where its barely usable anymore. I mean how much restrictions can one possibly work with?

    They removed Personal (Gift) payments option for Indians and now are gonna remove Goods/Services payment options as well. Now all payments are to be made using Credit Card and everytime you do that paypal will charge 2.5% fees and other foreign exchange fees and its not like everyone of us have credit cards which is why many of us started using paypal in the first place.

    You have to transfer all funds you receive within 7 days to bank and each time you withdraw, Rs. 50 is charged which means you are losing more money if you are set to receive small payments every week from a company.

    I say we explore options like Moneybookers, Liberty Reserve and Alertpay, how much they charge for payments received, sent and withdrawn and if they allow us to withdraw to Indian banks.

  • Amaron

    I don’t get the point for banning outgoing transactions for buying domains names, web hosting space, digital games, etc.

    RBI needs to grow up and understand that above transactions aren’t illegal in anyway. They need to change 11 year old FEMA act for this.

    I still don’t get the point of banning outgoing transactions…


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