For a few days after March 1, 2011, Paypal users in India got the following notification after logging in to their Paypal account.
Notification for PayPal users in 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”).
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. Click here to learn more.
Go to My Account
The notification did not appear for a few days, but it is now again visible.
Other than blocking mass payments , no other major changes have appeared in Paypal site for Indian users. Many personal and premier account holders have been able to send money from their account and receive money, though some Paypal business account holders have had the $500 restriction implemented and accounts limited. Paypal users who have written to Paypal support have been told that their accounts are being monitored. A similar rule seems to be implemented in Turkey without advance notification with users unable to pay from Paypal balance.
Till January 2010, any Paypal user could have one business and one personal account as per Paypal’s Terms of Service. After Paypal wanted users to associate a PAN number with each account, some users had to choose between the business and personal account, since a PAN number could be associated with one account only. With the new changes users now face the following disadvantages:
1. They are forced to withdraw at the prevailing exchange rate, earlier they could time their withdrawals to get the best exchange rate.
2. Higher exchange rates for payments in US$ - Visa/ Mastercard charge around Rs 47/$ , Paypal charges approx. Rs 46/$ .
