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India Suspended From PayPal For "At Least a Few Months"
More details have come about about what was behind PayPal's decision to suspend personal payments to any user in India, as we discussed on Sunday. In a blog post today, PayPal revealed that payments to India will remain in suspension for at least a few months. Customers in India will be able to pull rupees out of the service into their bank accounts within a few days. The suspension came about when Indian government regulators raised questions about whether PayPal's service was enabling remittances (transfers of money by foreign workers) to Indian citizens. "The problems may have been triggered by a marketing push that promotes PayPal as a way to send money abroad, a source familiar with the matter said. The campaign — which reads 'As low as $1.50 to send $300 to countries like India' — may have caught the attention of Indian regulators, the source said."
The aim is not to stop remittances, but to permit remittances only if the required paper work has been submitted (Which is very simple one page form, asking for sender and receiver details (name, address, identity proof) and reason for transfer).
The RBI (Reserve Bank of India) mandates banks registered in India to collect these before forex transfers can be made.
In this case, paypal doesnt want to be registered as a bank and fall under RBI regulations. As a result have been banned. I am surprise it did not happen earlier.
And just to make it clear, SWIFT Transfer (also called wire transfer) and mailing checks/DDs will continue to work. There are no options send/receive money order to/from India
FYI, not in India. Western union cannot be used to send money from India. It can be used to send to India though, where the recipient can furnish necessary documentation (identity proof, name address, reason for transfer) and collect it.
"There is so much dubious crap buried in the terms and conditions that none save a seasoned lawyer would figure out, and so many stories of people being royally screwed over by paypal (eg bank accounts being wiped out for no apparent reason)..."
As someone who worked at PayPal and saw the horror first hand over the years, I cannot possibly agree more. The Terms sheet is a deck that is stacked against the user at every opportunity.
I remember first hand seeing an employee (with a reputation for incompetence) award $30,000 to a fraudster from a legitimate business account. This is a common error, and PayPal sets aside a budget to fix these mistakes. But because of the dollar amount, upper management decided to hide behind some vague language in the terms sheet and screw the good user.
I don't know how the story ended out exactly. Legally they may have gotten away with it. But just because it was legal doesn't mean it was moral.