India Suspended From PayPal For "At Least a Few Months"

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India Suspended From PayPal For "At Least a Few Months"

Posted by kdawson on Tuesday February 9, 2010 @04:24PM from the keeping-the-money-out dept.

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."

144 of 186 comments (clear)

State vs Internet by drDugan · 2010-02-09 16:27 · Score: 2, Interesting

Stopping money flow and financial services innovation is, like Internet censorship,
a symptom of the fundamental conflict between the traditional role the state has expanded
to cover (ie governments) and the transparent, open and global nature of the Internet.
When everyone on the planet can communicate directly and immediately, through
fully automated translators, to any other connected person or to large groups
- why exactly do we need massive percentages (10-50%) of our resources funneled
to maintain the state and state-run defense and services? To preserve the old lines
on maps and control the access to major geographic regions? In almost every single
case, Internet connected people and services will do a better job.
The necessary reasons for countries as they exist today mostly go away when the
Internet fully connects individuals.* Obsolescence is a terrible thing for
bureaucracy, but can be framed as the primary driver of most "issues" governments
have with the Internet.
* physical defense and security being the only notable exception.
1. Re:State vs Internet by kai_hiwatari · 2010-02-09 16:34 · Score: 5, Insightful
  
  Stopping money flow and financial services innovation is, like Internet censorship,
  Its not about stopping money flow, but rather money flow in a regulated manner. I don't think its even legal for PayPal to have the services they offer without registering itself as a bank. As another someone said earlier, "The problem is PayPal wants to do the functions of a bank but does not want to be registered as a bank".
2. Re:State vs Internet by ImNotAtWork · 2010-02-09 16:43 · Score: 4, Informative
  
  You don't have to be a bank to transfer funds from one point to another. Western Union can send money across international boundaries. It isn't a bank either, it's a financial service.
  
  --
  open source sub sim. I might start coding again for this. http://dangerdeep.sourceforge.net/contribute/
3. Re:State vs Internet by _merlin · 2010-02-09 16:45 · Score: 4, Informative
  
  Western Union doesn't hold funds in accounts for you, and doesn't do short-term loans.
4. Re:State vs Internet by ColaMan · 2010-02-09 16:54 · Score: 4, Insightful
  
  why exactly do we need massive percentages (10-50%) of our resources funneled
  to maintain the state and state-run defense and services
  So that people who are envious of your physical resources don't all band together, drop by your house one day, and proceed to hack you to bits with machetes? So that there's a semi-controlled environment to enable the provision of services - like power, water and maybe even a little internet?
  * physical defense and security being the only notable exception.
  And a very big fucking exception they will remain, too.
  Dreams, meet reality. Watch out for reality's sucker punch, it can really catch you unawares.
  
  --
  
  You are in a twisty maze of processor lines, all alike.
  There is a lot of hype here.
5. Re:State vs Internet by Charliemopps · 2010-02-09 16:58 · Score: 5, Insightful
  
  And don't forget, India was mostly unaffected by our recent economic downturn because of their draconian economic laws. For decades they were criticized for their over regulation of their financial markets but after the fall, India was seen as a model for how markets could survive wide-scale economic collapse.
6. Re:State vs Internet by iammani · 2010-02-09 16:59 · Score: 5, Informative
  
  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.
7. Re:State vs Internet by avilliers · 2010-02-09 17:06 · Score: 3, Insightful
  
  The necessary reasons for countries as they exist today mostly go away when the Internet fully connects individuals.* Obsolescence is a terrible thing for bureaucracy, but can be framed as the primary driver of most "issues" governments have with the Internet.
  * physical defense and security being the only notable exception.
  Can you give one example of a core role that becomes obsolete? I assume there must be something. The post? That was a core role a couple centuries ago, I guess.
  Most state funds go to transportation infrastructure, "physical defense" (ie, military), law enforcement & prisons, education, health care, retirement pensions and other social safety nets (not in that order). Research funding, parks, civil courts, disaster recovery aid & regulatory enforcement and the like are a few of the other less-expensive things that get money.
  *None* of those vanish when the internet connects individuals. [I understand that some will pick their least favorite (the military, or the social safety net) and say the government shouldn't be doing it anyway, but that desire's independent of 'connectivity'.] A few clerks may lose their jobs due to on-line requests being filled, but I'm not even sure what people are imagining when they think the internet will somehow obsolete governments--let alone why a state bureaucrat would be living in existential dread.
  I assume this particular case boils down to people evading taxation, which is going to be an issue as long as the government spends any money at all. It'll be, unavoidably, the very last state function that becomes obsolete.
8. Re:State vs Internet by Dalambertian · 2010-02-09 17:21 · Score: 3, Informative
  
  Out of curiosity, what percentage of our wealth would you say is required to provide for the common defense?
  a) 0-10% b)10-50% c) > 50%
  If you answered (a), then you and dugan might be in agreement.
9. Re:State vs Internet by westlake · 2010-02-09 17:22 · Score: 1
  
  Stopping money flow and financial services innovation is, like Internet censorship, a symptom of the fundamental conflict between the traditional role the state has expanded to cover (ie governments) and the transparent, open and global nature of the Internet.
  I've had all the innovation in financial services I can stand for a decade or so, thank you.
  There is nothing inherently open and transparent about the Internet. Traffic can be encyrpted or disguised in any number of ways, some more successful than others.
10. Re:State vs Internet by zemblue · 2010-02-09 17:33 · Score: 2, Insightful
  
  It is about stopping money flow. Somebody has purposefully done this to restrict our ability to help each other. (conspiracy alert) Artificial barriers have been put in place to restrict our movements in nearly all ways. Getting money overseas should be easy, but it has been made difficult to keep the poor countries poor. If India were able to access more resources I am sure the whole world would benefit, there are so many talented people being put through financial hardship in India. If information, communication and resources (including money) flowed more easily then nations and people could co-operate with each other more efficiently.
11. Re:State vs Internet by Anonymous Coward · 2010-02-09 17:38 · Score: 1, Interesting
  
  Western Union also does not permit transfers from India to USA -- a customer just tried this and it was not available to him in India. He used PayPal, but ran into a USD500 limit and only sent me a partial payment. Eventually, he had a friend in the USA send me a check for the balance (I'm in the USA). They will work out the personal loan between themselves later.
  I'll be keeping an eye on my PayPal account to see if his partial payment stays around!
12. Re:State vs Internet by BrokenHalo · 2010-02-09 17:41 · Score: 2, Insightful
  
  FYI, not in India.
  
  Exactly. For once, it does not seem to be PayPal that is the baddie here. Although there have been many cases where PayPal has essentially snatched or frozen customers' funds, this doesn't seem to be one of them.
13. Re:State vs Internet by rmushkatblat · 2010-02-09 18:08 · Score: 1
  
  Your statement is incorrect. The internet is inherently open, but can be twisted.
14. Re:State vs Internet by TheLink · 2010-02-09 18:14 · Score: 4, Funny
  
  That's so true. Because of such artificial barriers I need your excellent help to transfer 40 million US dollars from Nigeria to Malaysia. :).
  --
  
  Too many replies beneath your current threshold
15. Re:State vs Internet by prayag · 2010-02-09 18:36 · Score: 2, Informative
  
  Actually money transfer to India is not difficult at all. I use bank and wire transfer and it works fine to transfer money to and from India. The problem is that Indian government wants to keep a full track of where and how money crosses border. It always had. Transfers through PayPal, unless it registers itself as a bank, are difficult to track. That is why the problem.
  BTW, for this reason, hawala transfers are illegal in India and have come under heavy fire.
16. Re:State vs Internet by obarthelemy · 2010-02-09 18:41 · Score: 3, Interesting
  
  ?
  1- PayPal is a poster case of why governments are needed: freezing, canceling, hijacking accounts with no rhyme, reason, nor customer service. Just imagine if banks where free to keep your cash 'coz they no longer like you. I'll use PayPal once it is regulated, meself.
  2- In some countries, the government is not only about regional control and protection. Education, Health, Retirement, Social Security... To my unprofessional eyes, governments do not seem to do much worse than the private sector in those domains, on average. I'd rather study, be sick, retire or be on the dole in France than in the US.
  3- Countries exist because it is easier to feel close to people with the same language and culture.
  Have you traveled at all ? Not as a tourist, but staying for moth than a month in a different country, working with locals ?
  
  --
  The Cloud - because you don't care if your apps and data are up in the air.
17. Re:State vs Internet by nmos · 2010-02-09 18:51 · Score: 2, Insightful
  
  For as long as there have been people they have been forming groups in order to advance their own interests at the expense of others. That's part of human nature and I don't see it changing any time soon.
18. Re:State vs Internet by AnotherUsername · 2010-02-09 19:02 · Score: 2, Insightful
  
  - why exactly do we need massive percentages (10-50%) of our resources funneled to maintain the state and state-run defense and services?
  Because, believe it or not, there is life outside of the Internet.
  
  --
  I don't like Linux. This doesn't make me a troll.
19. Re:State vs Internet by metlin · 2010-02-09 19:06 · Score: 5, Interesting
  
  You mean India was seen as a model for how lumbering, stagnant markets could ride through a temporary downturn.
  Only an idiot would consider an economy with almost 7% growth in a global downturn to be a lumbering, stagnant market.
  
  I don't think you understand what "wide-scale economic collapse" means. 2009 wasn't it.
  Apparently, neither do you.
20. Re:State vs Internet by metlin · 2010-02-09 19:13 · Score: 1
  
  Meh, frames.
  http://www.finmin.nic.in/stats_data/nsdp_sdds/index.html
21. Re:State vs Internet by raju1kabir · 2010-02-09 19:17 · Score: 1
  
  When you look deeply enough, all financial indicators are relative. There is no universal archetype of value against which things can be assessed. If everyone else is going down, and you tread water, then by most measures you have grown.
  To even have a hope of getting a real sense, you have to take a longer view than just one year, and you have to subtract costs like environmental damage and the accumulation of negative social factors. It takes a long time and a lot of hard work to even approach quantifying this stuff, and a quick glance at one indicator is barely scratching the surface.
  I have a lot of faith in India but at the moment the country is not living up to its potential and the government is a big part of the reason why.
  
  --
  "Patriotism is your conviction that this country is superior to all other countries because you were born in it." -- GBS
22. Re:State vs Internet by Anonymous Coward · 2010-02-09 19:41 · Score: 3, Insightful
  
  There are a lot of ways to remit money - western union, traditional banks, and non traditional means like Hawala which is used a lot in the subcontinent.
  So if some one wants to fund terrorists in India, Paypal becomes a very useful conduit -with almost no documentation needs. This is the same reason US has tried to destroy the Hawala network - there are not good records. Traditional banking arrangements atleast provide some idea of the financial flows.
  Generally US does the blocking of financial institutions etc. and Americans in general are used to accepting such laws since the 'terrorism' word is leveraged. I think India is just doing the same. If the only documentation you need to receive money is an email address....
  And... there are a few higly regulated markets out there. India is one - but another significant one is Canada. Not many banks lost much in Canada. What you call innovation in banking is basically a cool way for banks to enrich themselves.
  * Use customer deposits to gamble - and have so many customers, that you know if you fail, the government will have to step in.
  * Use the governmental funds to then again gamble and pay yourself.
  * Laugh at the fools on the sidelines who think the banks tried their best.
23. Re:State vs Internet by Rocketship+Underpant · 2010-02-09 19:44 · Score: 1, Troll
  
  "The problem is PayPal wants to do the functions of a bank but does not want to be registered as a bank"
  Whoever said that doesn't know what a bank does. It's not about holding money for you (everyone from your mutual fund advisor to escrow services to pre-paid cell phone vendors does that) or enabling financial transactions (any retailer can do that) or enabling currency exchanges (any hotel can do that).
  When Paypal says you have $100 in your account, they actually have that money somewhere waiting for you to withdraw.
  When a bank says you have $100 in your account, they actually take your money and spend it on champagne, Vegas hotel rooms, politicians, and investments of dubious value. When you go to withdraw it, they borrow $100 from someone else or even create it out of thin air.
  That is the difference, and that's why banks face a host of regulations and insurance requirements that Paypal does not.
  
  --
  He who lights his taper at mine, receives light without darkening me.
24. Re:State vs Internet by 1s44c · 2010-02-09 20:08 · Score: 3, Insightful
  
  You mean India was seen as a model for how lumbering, stagnant markets could ride through a temporary downturn.
  Only an idiot would consider an economy with almost 7% growth in a global downturn to be a lumbering, stagnant market.
  If I'm wondering the streets wearing rags and staving with only 100 cents in lose change that I found by digging though bins and begging and some kind soul gives me 7 cents am I then well off?
  Have you seen the poverty in India? There are endless armies of people with nothing who sleep on the streets, beg, and dig though mountains of garbage for anything of value. I have seen it myself.
  It's not hard to add 7% to very nearly nothing.
25. Re:State vs Internet by Kris_J · 2010-02-09 20:20 · Score: 1
  
  Paypal specialises in dodging regulation and being an arsehole. There may well be times when you can sing the praises of the wondrous capitalist market and how it solves everything, but this is not one of them.
26. Re:State vs Internet by sourcerror · 2010-02-09 20:24 · Score: 1
  
  Like a series of tubes?
27. Re:State vs Internet by Anonymous Coward · 2010-02-09 20:28 · Score: 2, Interesting
  
  The white man emasculates you
  because you assume he will emasculate you.
  The black man steals from you
  because you assume he will steal from you.
  The brown man slows you
  because you assume he will slow you.
  The yellow man trumps you
  because you assume he will trump you.
  We kill others
  because we assume they will kill us.
  We lie to others
  because we assume they will lie to us.
  We horde from others
  because we assume they will horde from us.
  We help others...
  Self-fulfilling stereotypes can only be stopped at the source: You.
28. Re:State vs Internet by shutdown+-p+now · 2010-02-09 20:28 · Score: 2, Interesting
  
  Canada's banks did well too.
  Yeah, and for exact same reasons - strict government regulations on how much and who they can credit.
29. Re:State vs Internet by PietjeJantje · 2010-02-09 20:29 · Score: 1
  
  Don't you get it? They just want their cut, and don't want Paypal to walk with it. The rest is noise.
30. Re:State vs Internet by MasterPatricko · 2010-02-09 20:56 · Score: 1
  
  We horde from others
  because we assume they will horde from us.
  I play Alliance, you insensitive clod!
  
  --
  I'd tell a UDP joke, but you may not get it. I'd tell a TCP joke, but I'd have to keep repeating it until you got it.
31. Re:State vs Internet by Yvanhoe · 2010-02-09 21:37 · Score: 1
  
  And a lot of the constraints about being registered as a bank have less to do with real regulation that prevent chaos than with the current banks discouraging newcomers.
  
  --
  The Wise adapts himself to the world. The Fool adapts the world to himself. Therefore, all progress depends on the Fool.
32. Re:State vs Internet by Anonymous Coward · 2010-02-09 21:53 · Score: 1, Funny
  
  Then join the Anti-Group Party. We are a growing organization, united in our belief that groups are wrong and must be stopped. If you join now, you get a badge that proudly displays one of our slogans and a membership id card that you can use at any of the daily meetings held in each major city across the US.
33. Re:State vs Internet by paziek · 2010-02-09 22:33 · Score: 4, Insightful
  
  They are baddie here. Banks probably don't have any issues with transferring funds to/from India. PayPal refuses to register as a bank and thus they get this issue. On the other hand, they are registered as a bank in EU and don't have any problems anymore. So perhaps they don't care about India that much?
  Don't blame them [India] for wanting to know what is happening with their own currency/finances.
34. Re:State vs Internet by jonbryce · 2010-02-09 22:35 · Score: 1
  
  In Britain, Western Union's banking type services are provided by Clydesdale Bank. Paypal hasn't partnered with a local bank to provide any of its banking type services.
35. Re:State vs Internet by JustOK · 2010-02-09 22:52 · Score: 1
  
  Because, believe it or not, there is life outside of the Internet.
  Yah, I know. I just got the app for that.
  
  --
  rewriting history since 2109
36. Re:State vs Internet by jisatsusha · 2010-02-09 23:26 · Score: 1
  
  In Europe at least, Paypal is registered as a bank, and is regulated as such.
37. Re:State vs Internet by pyite · 2010-02-09 23:33 · Score: 4, Insightful
  
  When Paypal says you have $100 in your account, they actually have that money somewhere waiting for you to withdraw.
  What in the world makes you think that? Not only do they probably have the money in various forms of liquid and illiquid assets, but there isn't even FDIC insurance to protect you if they screw up.
  
  --
  "Nature doesn't care how smart you are. You can still be wrong." - Richard Feynman
38. Re:State vs Internet by digitalchinky · 2010-02-09 23:57 · Score: 2, Interesting
  
  I see it every single day I look out my window right here in the Philippines. Might just be it's a better idea to spend that 7 cents on a condom once in a while, yeah?
39. Re:State vs Internet by Jeff+DeMaagd · 2010-02-10 01:09 · Score: 2, Insightful
  
  It seems maybe India can ride out booms too, not get affected so much by other people making money.
  India has been independent for roughly the same amount of time as Japan, a country leveled by the US in WWII. For its recent problems, Japan is still a major economic power, despite having a small fraction of the population of India. India's per capita income is $3100, Japan's is ten times that. Sure, India is right behind Japan in total GDP, the population difference is staggering.
40. Re:State vs Internet by nospam007 · 2010-02-10 04:51 · Score: 1
  
  Repeating myself for the umpteenth time, PayPal _is_ a bank based in Luxembourg since July 2, 2007.
  http://en.wikipedia.org/wiki/PayPal#Bank_status
41. Re:State vs Internet by sjames · 2010-02-10 08:08 · Score: 1
  
  Western Union also don't consider itself free to just grab your funds whenever it suits them and hold them for as long as they like.
42. Re:State vs Internet by metlin · 2010-02-10 09:14 · Score: 1
  
  Yes, there is poverty - but guess what? It's a lot less than what it once was.
  In fact, India and China liberalizing their economies and the flood of FDI and FII that came in has lifted hundreds of millions out of abject poverty.
  Go explore some data before playing the poverty card every time a developing country is brought up.
  Ignoring growth and citing poverty without seeing the progress is disingenuous at best.
43. Re:State vs Internet by BeanThere · 2010-02-10 09:51 · Score: 1
  
  PayPal is a poster case of why governments are needed: freezing, canceling, hijacking accounts with no rhyme, reason, nor customer service. Just imagine if banks where free to keep your cash 'coz they no longer like you.
  Actually, I'm afraid you're wrong --- think about it a bit: Firstly, banks, like PayPal, would go out of business quickly if they randomly grabbed money from peoples' accounts (PayPal may 'freeze' accounts and hang on to money for a long time, but it has never just purposely stolen money from its users willy-nilly). So banks have an *incentive* to manage your money well *even* in the absence of government regulation (yeah yeah don't tell me about the credit crunch - that is another story we can dig deeper into). Secondly, the very reason PayPal can act the way it does with relative abandon *is* that it has very little competition, and the very reason it has very little competition is the ridiculous amounts of banking-related regulation in the first place (this India incident, in case you didn't notice, is caused by onerous regulation by a government afraid of capital flight). So too much government regulation has caused this problem of PayPal's behaviour, and you think the answer is 'even more government regulation'. That is the fallacy of regulation --- people think that when it's not working, you need *even more* --- it's an ever downward spiral into massive burueacracies, and why the state is now bigger than it's been in a long time.
  I live in a borderline-fascist country where PayPal isn't available, due to onerous government regulation. Do you really believe your life would be better if PayPal didn't exist, and was just another crappy bank? You're welcome to come live where I do, where instead of "suffering" with the likes PayPal, you can have the option of nothing at all, thanks to the government regulation you desire so much. I'll gladly trade places with you, and have PayPal access, that will help my business grow.
  I have travelled extensively, so I'm not sure your point there.
  The dole? I also would never want to be on the dole, thank you - I think it's immoral to take someone else's money like that - I was raised with values that preclude theft, and I would never be able to live with myself; I'd rather be able to sleep the peaceful sleep of a man who knows he has earned his money.
44. Re:State vs Internet by TheTyrannyOfForcedRe · 2010-02-10 10:14 · Score: 1
  
  There are endless armies of people with nothing who sleep on the streets, beg, and dig though mountains of garbage for anything of value. I have seen it myself.
  Have you been to Seattle lately?
  
  --
  "Liechtenstein is the world's largest producer of sausage casings, potassium storage units, and false teeth."
45. Re:State vs Internet by asaz989 · 2010-02-11 02:13 · Score: 1
  
  "lumbering, static" doesn't mean poor, it means unchanging. Unchanging is the one thing a fast-growing poor country like India or China or Turkey is not. 10 years of 7% income growth, and that hypothetical person wandering the streets pulling in a dollar a day will instead be making two; and when you're poor, that's a BIG difference.
46. Re:State vs Internet by EmpNorton · 2010-02-11 08:38 · Score: 1
  
  but there isn't even FDIC insurance to protect you if they screw up.
  Yes there is: http://www.paypal.com/cgi-bin/webscr?cmd=p/gen/travelers-outside
Paypal is a mess by Seriousity · 2010-02-09 16:29 · Score: 5, Insightful

I hope they get in the crap with even more countries and are forced to do stuff like this, maybe eventually they'll have to declare themselves as an actual bank and give their users rights over their money for a change. 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)...

--
This post was made in complete sincere seriousity; as such any attempts to derive humour are doomed to instant failure.
1. Re:Paypal is a mess by Anonymous Coward · 2010-02-09 17:33 · Score: 5, Interesting
  
  My IP, name, address, phone number, etc. are banned on paypal and any variation thereof and they tried to send a collection agency after me for 2 accounts I had. I told them to fuck off and they can't do jack since I, as a precautionary measure, changed my bank account numbers as soon as they limited my accounts. Just because some buyer decides to do a chargeback on his credit card 120 days after purchase does not mean I am responsible for the money. Paypal is not a bank. I did not borrow from them. I do not owe them anything, and they can't touch my credit. The paypalsucks website is living truth of what they can do to their customers. Some people lost $5K plus, and most are scared into cooperating by the collection agency. I at least didn't lose anything except for the account I opened in 1999 and my ability to use ebay, but they can lose the business. I use craigslist instead now and don't have to pay to put up auctions or pay transfer fees.
2. Re:Paypal is a mess by Anonymous Coward · 2010-02-09 17:58 · Score: 5, Informative
  
  "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.
3. Re:Paypal is a mess by BeanThere · 2010-02-10 09:58 · Score: 1
  
  Just because some buyer decides to do a chargeback on his credit card 120 days after purchase does not mean I am responsible for the money. Paypal is not a bank. I did not borrow from them. I do not owe them anything, and they can't touch my credit
  But surely when you signed up with them initially, you agreed to their terms of service, which would've included responsibility for chargebacks? Are you saying you committed fraud against PayPal by flouting the ToS you had agreed to? Sorry to be a 'devil's advocate', but if you didn't like their ToS, you should not have agreed to use their services in the first place.
4. Re:Paypal is a mess by BeanThere · 2010-02-10 10:02 · Score: 1
  
  I hope they get in the crap with even more countries and are forced to do stuff like this, maybe eventually they'll have to declare themselves as an actual bank
  I hope not - God help us if that happens, because the reason banks are unable to compete and become as useful as PayPal is that they're crippled by over-regulation (yeah I know it's unpopular to say that in today's "banks are teh evil, pitchforks against the banks!!1!" culture, but people are over-reacting). Be careful what you wish for: The fact is, that thing you cry out for is precisely what would destroy PayPal if you ever got your wish, and then you'll wish there was a PayPal. I live in a country where PayPal isn't available precisely because of government over-regulation (hangover from dictatorship days where government tried to watch and control every movement people made with their money), and if you'd prefer to trade places with me and have have no PayPal at all instead of the current crappy one, I'd be very happy to do so.
Bullshit by digitalunity · 2010-02-09 16:29 · Score: 3, Interesting

Isn't this in direct contradiction to something PayPal said a day or two ago? Something akin to "golly gee we're not sure what happened but we're looking into it".
On another note, this applies to private transactions only, not commercial ones. This directly affects any freelancers who aren't operating as a company though, such as Rent-A-Coder, et. al.

--
You can't legislate goodness. Let each to his own destiny, by will of his freely made choices.
1. Re:Bullshit by mysidia · 2010-02-09 16:34 · Score: 2, Interesting
  
  On another note, this applies to private transactions only, not commercial ones. This directly affects any freelancers who aren't operating as a company though, such as Rent-A-Coder, et. al.
  According to TFA it applies to personal payments, not purchase of goods or services, regardless of whether they're operating as a corporation or not.
  
  If this was a payment for a purchase of goods or services, you should contact the sender and have him or her resend the payment as follows:
  
  (a) click the Send Money tab, and
  
  (b) select “purchase.”
  
  If this was a personal payment, then the sender will need to find another payment method until we restore the service. We’re sorry about this.
  Oh.. but since it must be sent as a purchase, the recipient must have an account enabled for selling things, and PayPal will of course charge a transaction fee on the transfer.
2. Re:Bullshit by ls671 · 2010-02-09 16:47 · Score: 1
  
  > This directly affects any freelancers who aren't operating as a company though, such as Rent-A-Coder, et. al.
  Ahhh, we can finally raise our rates to American ones, thanks...
  You know it takes a lot of money to live here, don't you ?
  I am not saying this really seriously of course ;-))
  
  --
  Everything I write is lies, read between the lines.
3. Re:Bullshit by davester666 · 2010-02-09 16:51 · Score: 1
  
  There was a miscommunication when the person called PayPal. The call was forwarded to a call-center in India, and they couldn't understand the person's accent...
  
  --
  Sleep your way to a whiter smile...date a dentist!
4. Re:Bullshit by GoochOwnsYou · 2010-02-09 16:59 · Score: 1
  
  Something akin to "golly gee we're not sure what happened but we're looking into it".
  
  Mr Bean works for PayPal? Well I guess that explains alot
  
  --
  This sig has been distributed under the Creative Commons license.
5. Re:Bullshit by raju1kabir · 2010-02-09 17:51 · Score: 1
  
  According to TFA it applies to personal payments, not purchase of goods or services
  Most freelancers in India are receiving their money as personal payments.
  
  --
  "Patriotism is your conviction that this country is superior to all other countries because you were born in it." -- GBS
6. Re:Bullshit by Anonymous Coward · 2010-02-09 22:35 · Score: 1, Informative
  
  Having worked for PayPal, I'm sure the phone agents didn't know what the legal department was doing, because there is NO COMMUNICATION.
7. Re:Bullshit by Hognoxious · 2010-02-09 23:40 · Score: 1
  
  According to TFA it applies to personal payments, not purchase of goods or services, regardless of whether they're operating as a corporation or not.
  
  This doesn't make sense. If you're operating as a corporation then surely it's a business payment, not a personal one?
  
  --
  Confucius say, "Find worm in apple - bad. Find half a worm - worse."
8. Re:Bullshit by Hognoxious · 2010-02-09 23:45 · Score: 1
  
  Isn't this in direct contradiction to something PayPal said a day or two ago? Something akin to "golly gee we're not sure what happened but we're looking into it".
  If the government blocked it, and told them not to tell anybody, they're hardly likely to answer "The government told us to do it, but they also said to keep quiet about it".
  
  --
  Confucius say, "Find worm in apple - bad. Find half a worm - worse."
9. Re:Bullshit by mysidia · 2010-02-10 02:18 · Score: 1
  
  Not all corporations make only business transactions.
  Sometimes the owner doesn't follow best practices -- and mixes personal funds with corporate funds.
10. Re:Bullshit by mysidia · 2010-02-10 02:23 · Score: 1
  
  Isn't that practice a violation of PayPal's Terms of Service, and possibly fraud?
  PayPal charges fees for transactions that are for purchases of products or services. Mislabelling a commercial transaction as a personal one sounds like a substantial misrepresentation of the transaction taking place (and fee evasion).
11. Re:Bullshit by TheTyrannyOfForcedRe · 2010-02-10 10:28 · Score: 1
  
  Isn't this in direct contradiction to something PayPal said a day or two ago? Something akin to "golly gee we're not sure what happened but we're looking into it".
  Take everything Paypal says with a grain of salt. Their place on my trust scale is somewhere in the vicinity of meth-head stripper.
  
  --
  "Liechtenstein is the world's largest producer of sausage casings, potassium storage units, and false teeth."
Analog tech... by eparker05 · 2010-02-09 16:36 · Score: 1, Informative

While PayPal may be convenient, shutting down paypal will not stop remittences. People can simply place a check in an envelope and mail it. Money orders are also an option.
1. Re:Analog tech... by iammani · 2010-02-09 16:56 · Score: 5, Informative
  
  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
2. Re:Analog tech... by DNS-and-BIND · 2010-02-09 16:56 · Score: 1
  
  The goal is not to stop remittances, to the goal is to enforce Indian law. This "the bomber will always get through" attitude is puzzling, to say the least. Sure, you can "fall back to analog tech" as you crudely put it. Are you really suggesting to send an instrument of financial value through India Post? Are you daft, sir?
  
  --
  Shutting down free speech with violence isn't fighting fascism. It IS fascism!
3. Re:Analog tech... by eparker05 · 2010-02-09 17:04 · Score: 1
  
  Whatever the reasons behind the temporary shutdown of services, perhaps it could have been resolved by a less dramatic action. PayPal is obviously a great convenience for its many users. I do not see why this investigation required a complete cessation of the PayPal services when legitimate users are going to be victimized, while sneaky users will find other ways around the government.
4. Re:Analog tech... by rmathew · 2010-02-09 18:26 · Score: 1
  
  Indeed the Hawala system is the biggest source of unregulated remittances in these parts. At least with PayPal the RBI can track who gives money to whom when required.
  PS: It is spelt "remittance".
  
  --
  rmathew.com
5. Re:Analog tech... by junglee_iitk · 2010-02-09 23:16 · Score: 1
  
  Interestingly, the exchange rate of PayPal is worse than many other banks (HDFC for example). Otherwise I would have been doing this long ago. :/
Money laundering... by blahplusplus · 2010-02-09 16:44 · Score: 1

... and tax evasion IMHO is what this is really going to be about sooner or later.
Paypal allows ones to hide funds from governments of the world as a non bank institution.
1. Re:Money laundering... by ottothecow · 2010-02-09 17:17 · Score: 1
  
  Yeah but do you have any idea how scary it would be to keep any sum of money that was actually worth saving in a paypal account?
  I can see something like returning a $100 ebay purchase and being too lazy to initiate the transfer back to your bank account (since you would eventually spend it anyways)..if they should randomly shut you down you are not out very much. But if you had the kind of money that is worth hiding....
  
  --
  Bottles.
Re:My conspiracy theory by kai_hiwatari · 2010-02-09 16:45 · Score: 1

PayPal is the one getting bad press here not India
Why limit incomming remittance? by gd2shoe · 2010-02-09 16:47 · Score: 1

What I don't get is why India wants to stop remittances from coming into the country. Why wouldn't they want money to flow into the country which will be spent in the local economy? The foreign currency will either fund imports or will favorably affect exchange rates. I'm clearly missing something here.

--
I won't join Slashcott. OTOH, If Beta goes live, I just won't be back until it's fixed. Sorry Dice.
1. Re:Why limit incomming remittance? by kabloom · 2010-02-09 16:52 · Score: 1
  
  Terrorism concerns, money laundering, etc... (though there's no specific concern with remittances per-se, governments do want to know where money is coming from and where it's going to look for suspicious terror.)
2. Re:Why limit incomming remittance? by Anonymous Coward · 2010-02-09 16:52 · Score: 2, Insightful
  
  I have no idea persay, but I would be shocked if it wasn't directly caused by their fear that they wouldn't be able to effectively tax such income.
3. Re:Why limit incomming remittance? by nedlohs · 2010-02-09 16:57 · Score: 5, Insightful
  
  1. The want to know about it so they can tax it.
  2. They don't want foreign funding of domestic terrorists.
  3. They don't want criminals to have yet another way to move money around.
  4. They want to protect their export industry by not having that "favorable" effect on exchange rates.
4. Re:Why limit incomming remittance? by danielsfca2 · 2010-02-09 16:59 · Score: 1
  
  Yeah i'm pretty confused. Remittances aren't illegal. And according to the linked wiki article India is the world's #1 recipient of remittances!
5. Re:Why limit incomming remittance? by Ihmhi · 2010-02-09 17:38 · Score: 1
  
  Wouldn't the money be taxed when its spent? Doesn't India have some sort of VAT, Sales Tax, etc.?
  This is why income taxes are stupid and taxes on spending are better. You can't hide the money because at some point in the chain the item was purchased from a store.
  
  --
  Random Thoughts From A Diseased Mind (Not For Dummies)
6. Re:Why limit incomming remittance? by BrokenHalo · 2010-02-09 17:51 · Score: 1, Insightful
  
  I have no idea persay, but I would be shocked...
  
  What is more shocking is the number of people who seem to think "persay" is a word. The expression is per se, meaning "by, of or in itself".
7. Re:Why limit incomming remittance? by raju1kabir · 2010-02-09 17:53 · Score: 1
  
  Wouldn't the money be taxed when its spent? Doesn't India have some sort of VAT, Sales Tax, etc.?
  India has a massive informal economy. It's not like Canada where every business does neat little books and has an electronic cash register that spits out a report for the tax man at the close of business.
  
  --
  "Patriotism is your conviction that this country is superior to all other countries because you were born in it." -- GBS
8. Re:Why limit incomming remittance? by Anonymous Coward · 2010-02-09 18:15 · Score: 1, Interesting
  
  Exactly. Think of the West a century or so ago. Enforcement of the law (specifically for taxes) is very difficult and most people do end runs around the government. Bribing Income Tax (India's IRS) officers is routine for most businessmen. The situation is improving but is far from ideal.
9. Re:Why limit incomming remittance? by NeoSkandranon · 2010-02-10 03:51 · Score: 1
  
  informal is an interesting choice of word :)
  
  --
  If you can't see the value in jet powered ants you should turn in your nerd card. - Dunbal (464142)
10. Re:Why limit incomming remittance? by tehcyder · 2010-02-10 04:07 · Score: 1
  
  What is more shocking is the number of people who seem to think "persay" is a word.
  
  I hope this isn't another "loosing" battle.
  
  --
  To have a right to do a thing is not at all the same as to be right in doing it
11. Re:Why limit incomming remittance? by BeanThere · 2010-02-10 10:11 · Score: 1
  
  The thing is, there is no fundamental difference between a currency trade, and *any* movement of money. Thus the fundamental question at heart here is actually "do free citizens have the right to ever exchange money without the government being informed". If you believe governments must have knowledge of every forex transaction, then by extension you must also believe that governments must have knowledge every time money changes hands anywhere at all for anything at all. Governments mostly already believe they have that right, but I draw the line there and don't agree. Of course we need to minimise problems like terrorism (which is actually quite minimal already), but most e.g. problematic money laundering is already for activities that probably should be legal anyway (e.g. cannabis, gambling), and if that was fixed, that would free state resources to do more and better policing against the really bad stuff, which would seriously mitigate any negative effect that easing the omnipresence of government "watching every transaction" might have.
So ... by wisnoskij · 2010-02-09 16:49 · Score: 1

So is it illegal to transfer money into India? or do they just highly monitor all ways to do this (other then paypal)?

I fail to see how such a policy is worth the economic problems of shuting down paypal for a whole country must of caused.
And I am sure most of the people currently doing the remittances have probably been doing it for quite awhile, so why were they is such a rush that they could not have "fixed" their system without shutting down paypal in the mean time?

--
Troll is not a replacement for I disagree.
1. Re:So ... by compro01 · 2010-02-09 17:03 · Score: 1
  
  So is it illegal to transfer money into India?
  
  If you don't feel like following the reasonable regulations on foreign exchange transactions and submit the proper paperwork (a trivial one page form), yes.
  This is basically India taking issue with paypal wanting to act like a bank without being regulated like one.
  
  --
  upon the advice of my lawyer, i have no sig at this time
2. Re:So ... by dakameleon · 2010-02-09 17:13 · Score: 1
  
  I fail to see how such a policy is worth the economic problems of shuting down paypal for a whole country must of caused.
  Firstly: it's must have, not must of. Surely you're not 12 years old with that UID?
  Secondly: What makes you think paypal is so integral to the Indian economy that it "must have" caused "economic problems"? Rest assured that this is unlikely to have caused more than a teeny tiny blip in the grand scheme of things.
  
  And I am sure most of the people currently doing the remittances have probably been doing it for quite awhile, so why were they is such a rush that they could not have "fixed" their system without shutting down paypal in the mean time?
  You might not be familiar with the words "financial regulator" in America, but generally speaking in the rest of the world, when they act they act immediately and don't dither or worry about a potentially infringing system not being available. The commercial entity does not have an automatic right to operate if it is potentially infringing the regulations or laws.
  
  --
  Man who leaps off cliff jumps to conclusion.
3. Re:So ... by wisnoskij · 2010-02-09 17:35 · Score: 1
  
  While I am sure it did not damage India's economy the linked article did state that some (a significant enough "some" to be worth mentioning, apparently) of them do use it to get payed for their job.
  So this action by PayPal I am sure has inconvenienced many people and for any everyone that uses it as a source of income could find the next months financially challenging.
  So while they might not have a right to operate, I would hope any country would think twice before doing anything that would jeopardize any of its citizens legal sources of income.
  
  Note: I was not overly careful with my grammar so maybe you can find another mistake to poke fun of, if you find my logic/opinion to hard to counter.
  
  --
  Troll is not a replacement for I disagree.
4. Re:So ... by dakameleon · 2010-02-09 23:01 · Score: 3, Insightful
  
  While I am sure it did not damage India's economy the linked article did state that some (a significant enough "some" to be worth mentioning, apparently) of them do use it to get payed for their job.
  "Some" of India's 1 billion plus population might be a non-trivial number but the amounts involved are not significant in a $1 trillion plus GDP economy. Sure, some people got burned using a method that's been called into question by the regulator; it's no biggie from India's overall point of view. From Paypal's point of view though, it's significant because of the potential of the Indian market, and that's why I think it's been given such coverage - it is an American publication focused on the technology space, which means Paypal is significant to it. It's a question of perspective.
  
  So this action by PayPal I am sure has inconvenienced many people and for any everyone that uses it as a source of income could find the next months financially challenging.
  It isn't an action by Paypal, it's an action by the Indian regulator, and it's not a source of income, it's a method of payment - payment that can be achieved through other means.
  
  So while they might not have a right to operate, I would hope any country would think twice before doing anything that would jeopardize any of its citizens legal sources of income.
  The issue is that their their method of payment is under investigation. Whether it's because the payment method allows them to dodge taxes, avoid necessary official declaration or simply that it can aid money laundering, it's something that a regulator is obliged to do. If the word "terrorist" was thrown in there, for example "paypal shuttered because it potentially allows terrorists to transfer funds", would that be sufficient justification?
  
  Note: I was not overly careful with my grammar so maybe you can find another mistake to poke fun of, if you find my logic/opinion to hard to counter.
  It wasn't an issue of grammar, it was the wrong word entirely. My issue was with ignorance and the transmutation of "'ve" to "of" due to idiocy, and I called you on it to make an effort to stop it spreading. If you don't want to make an effort to proof your writing, that's your choice, but don't get defensive when you get called on it.
  
  --
  Man who leaps off cliff jumps to conclusion.
Re:My conspiracy theory by DNS-and-BIND · 2010-02-09 16:51 · Score: 1

My, how our mental filters reveal who we really are! Frankly, I thought this was an article about how Paypal is a despicable scofflaw yet again, this time with the Indian government, who presumably are not bought and paid for like Western politicians and who are not putting up with Paypal's latest nonsense. But hey, you got a persecution complex, let it all hang out. Use words like 'colonialism', 'empire', and 'hegemony' for maximum effect and you'll have a crowd following you in no time.

--
Shutting down free speech with violence isn't fighting fascism. It IS fascism!
Lots of questions - follow the money by HBI · 2010-02-09 16:51 · Score: 1

I'm sure it has something to do with an Indian entity, say the government and banks, being cut out of fees.
Baksheesh.

--
HBI's Law: Frequency of calling others Nazis is directly correlated with the likelihood of the accuser being Communist.
PayPal bypass the SWIFT system by ub3r+n3u7r4l1st · 2010-02-09 16:59 · Score: 1

According to the World Bank, India is the world's LARGEST recipient of remittances. I assume the Indian government got commission out from these remittances. Having PayPal operate there will bypass the whole SWIFT system, which mean that the government will lose a huge income.

--
New Economic Perspectives
1. Re:PayPal bypass the SWIFT system by _merlin · 2010-02-09 19:55 · Score: 2, Informative
  
  SWIFT doesn't actually perform fund transfers. SWIFT just provides a standard platform for sending messages between banks. It's the Indian banks (and other ForEx providers) who have to report transactions to the government, anyway.
Re:My conspiracy theory by BhaKi · 2010-02-09 17:01 · Score: 1

My, how our mental filters reveal who we really are! Frankly, I thought this was an article about how Paypal is a despicable scofflaw yet again, this time with the Indian government, who presumably are not bought and paid for like Western politicians and who are not putting up with Paypal's latest nonsense. But hey, you got a persecution complex, let it all hang out.
I don't quite get it. Are you concurring with me? or disagreeing?

Use words like 'colonialism', 'empire', and 'hegemony' for maximum effect and you'll have a crowd following you in no time.
No thanks, I wouldn't stoop to that level.

--
The largest prime factor of my UID is 263267.
Re:My conspiracy theory by nedlohs · 2010-02-09 17:06 · Score: 2, Interesting

What negative portrayal of India is there here?
Seriously, there's nothing negative at all in any of those links (well I'm sure there is in the comments on the link to another slashdot article, but that article itself isn't) or in the summary.
Re:My conspiracy theory by BhaKi · 2010-02-09 17:12 · Score: 1

PayPal is the one getting bad press here not India
Yes. But under that cover/ruse/whatever, there is a negativism. It gets reflected in the comments posted. For instance,
http://news.slashdot.org/comments.pl?sid=1543706&cid=31082012
http://news.slashdot.org/comments.pl?sid=1543706&cid=31082188

--
The largest prime factor of my UID is 263267.
OMG! by Brandybuck · 2010-02-09 17:12 · Score: 1

God forbid that someone should give some money to someone else!

--
Don't blame me, I didn't vote for either of them!
1. Re:OMG! by tangent3 · 2010-02-09 18:50 · Score: 2, Informative
  
  They are not trying to stop you from giving money to someone else, but from giving money to someone else [b]without leaving a trace[/b] that can be taxed or to be investigated for illegal money laundering.
2. Re:OMG! by BeanThere · 2010-02-10 10:13 · Score: 1
  
  You mean "God forbid that someone should give some money to someone else (without government taking a cut)".
3. Re:OMG! by Brandybuck · 2010-02-15 12:39 · Score: 1
  
  God forbid that someone should give some money to someone else (without organized crime taking a cut).
  FIFY
  
  --
  Don't blame me, I didn't vote for either of them!
Re:My conspiracy theory by BhaKi · 2010-02-09 17:20 · Score: 1

What negative portrayal of India is there here?
Seriously, there's nothing negative at all in any of those links (well I'm sure there is in the comments on the link to another slashdot article, but that article itself isn't) or in the summary.
The article is about economic regulation in India. Any regulation, at first sight, appears as bad. Isn't it?

--
The largest prime factor of my UID is 263267.
Look at the Slashdot title by dakameleon · 2010-02-09 17:20 · Score: 1, Offtopic

You wouldn't guess it from the title - should be "Paypal suspended in India", not "India suspended..."

--
Man who leaps off cliff jumps to conclusion.
1. Re:Look at the Slashdot title by nedlohs · 2010-02-09 17:49 · Score: 2, Funny
  
  The rest of us read more than the first two words.
2. Re:Look at the Slashdot title by tehcyder · 2010-02-10 04:13 · Score: 1
  
  The rest of us read more than the first two words.
  
  Show off.
  
  --
  To have a right to do a thing is not at all the same as to be right in doing it
WTF?? Indian politicians are nuts, just nuts by Russ+Nelson · 2010-02-09 17:27 · Score: 1, Insightful

Yo! India politicians! Another word for remittances is: FOREIGN CAPITAL. They're a GOOD THING. You want your citizens to GET LOTS OF THEM. Getting foreign money into your country is a FREE LUNCH. It's the reason your EXPORT STUFF.
My god. I shake my head.

--
Don't piss off The Angry Economist
1. Re:WTF?? Indian politicians are nuts, just nuts by Anonymous Coward · 2010-02-09 19:50 · Score: 1, Funny
  
  THANK you. COME again.
2. Re:WTF?? Indian politicians are nuts, just nuts by Anonymous Coward · 2010-02-09 20:39 · Score: 5, Insightful
  
  Not when the "FOREIGN CAPITAL" exchange service skirts the rules of responsible financial governance... or funds terrorism.
  Paypal is not the only option and they should learn to play by the rules the makes sense.
3. Re:WTF?? Indian politicians are nuts, just nuts by pkphilip · 2010-02-09 22:12 · Score: 1
  
  Foreign capital is fine. India has multiple options for transferring capital to India. What the regulators don't want is unregulated transfers happening - possibly due to the old bogey of terrorism.
4. Re:WTF?? Indian politicians are nuts, just nuts by BlackCobra43 · 2010-02-10 01:10 · Score: 1
  
  I could not help myself but read your comment in the "Brawndo" advertisement style.
  
  FOREIGN CAPITAL - except the capital is 300 FEET TALL AND COVERED IN CHAINSAWS
  
  --
  I never spellcheck and I freely admit it. Save your karma for more worthwhile "lol erorrs" replies
Re:My conspiracy theory by nedlohs · 2010-02-09 17:47 · Score: 1

No. Well maybe to anarchists. And extreme libertarians.
Is regulating whether I should drive on the left or the right hand side of the road bad? Is regulating how much vinyl chloride I can dump into the public water supply bad?
Regulations on money transfers is completely ordinary and doesn't reflect on India at all, other than making the US happier with them.
Try transferring $50k into the US from India - it's not at the Indian end that that is going to be delayed and checked the longest.
Try transferring money from an foreign online casino into a US bank account.
MOD PARENT UP by ATairov · 2010-02-09 18:07 · Score: 1

The grandparent doesn't understand the purpose of a State.
1. Re:MOD PARENT UP by that+this+is+not+und · 2010-02-09 23:44 · Score: 1
  
  Isn't the purpose of the state for it to be something to wave your fist at and carry placards around protesting?
  You mean I can't stay in college forever??
So how will they pay their employees? by nmos · 2010-02-09 18:53 · Score: 1, Funny

I guess we can assume their customer service will be even more useless than usual now.
Misleading title by Zebai · 2010-02-09 19:18 · Score: 1

I think this should be titled, Paypal suspends operations in india while they figure out how to cheat people legally in that country.
And this is why... by matunos · 2010-02-09 19:39 · Score: 1

...we need Simoleons.
not State vs Internet, world vs paypal. by 1s44c · 2010-02-09 19:57 · Score: 1

You are right in what you say but you are missing the story here. Paypal isn't a money transfer service like it pretends to be, it's a bunch of crooks pretending to be a bank.
Paypal deserves to go bust and its management thrown in jail for the very many instances of theft they have committed over the years.
Anyone that hasn't seen the near endless stories about paypal closing accounts and keeping the cash for the most flimsy reason should exercise their googling skills.
experience from my recent trip to India by nerdyalien · 2010-02-09 20:18 · Score: 3, Informative

I visited New Delhi last November (2009).
On my way in, I managed to change my USD to INR at the airport right after the immigration counter, no problem with that.
But on my way out, I thought I can get my INR change back to USD at the air port (this is my normal routine). Alas! there are no money-changers at the airport. Even if they are available, they are only for Indians and it is capped at INR 5000.
I ended up bringing some 5-digit amount INR back to home, later changed back to USD and lost something like ~20 USD as I don't get same rates outside India.
This is ridiculous. I mean, I have been to many airports. And in most of them, there is a money changer and there are no restrictions for foreigners. But this is the first time I'm seeing other way around. Strange land indeed!
1. Re:experience from my recent trip to India by winwar · 2010-02-10 07:41 · Score: 1
  
  "And in most of them, there is a money changer and there are no restrictions for foreigners. But this is the first time I'm seeing other way around. Strange land indeed!"
  That actually is actually the norm for many "developing" countries. They want currency (wealth) to flow into the country but not out. Often a sign of an unstable local currency.
2. Re:experience from my recent trip to India by stub667 · 2010-02-17 19:07 · Score: 1
  
  Which would be particularly annoying if your next stop was Nepal, where 500 and 1000 rupee notes are not considered legal tender and technically an offence to bring into the country.
Reminds me of a forum I was on a few years ago... by Just+Brew+It! · 2010-02-09 20:34 · Score: 1

...where the site operator decided to block the entire country of Pakistan, in an attempt to get rid of a creepy cyberstalker who kept posting from Pakistani IPs. Shotgun approach! :D
(It didn't work; the guy just started using anonymous proxies located in other countries...)
The 1% users fault. by DrYak · 2010-02-09 22:09 · Score: 1

I've seen such stories and indeed they are sad, PayPal really looks like a mindless bully stealing money with random "BOFH-Calendar" excuses...
BUT...
There's a small 1% part of the fault in the users themselves:
- PayPal pretends to be a cash transfer service, not a Bank.
- Then why the hell are people keeping money in their PayPal accounts ?!? As soon as it gets into your PayPal, get it out of there and transfer it into a SAFER REAL BANK account.
People who rely on PayPal for their business should have the discipline to transfer the funds to a secure place on a regular basis.
PayPal will still be the thieves they are, but at worst, a paypal victims will only lose 1 business day worth of money (2-3 days if they were out-of-town for the weekend) Not the last couple of months.
I would personally never trust anything but a Bank to put my money into. I *do* use PayPal, but only to transfer money, as advertised. I keep my money safely into my swiss bank account
(and negotiating with the vault manager to put a tank with sharks around it :-D )

--
"Sufficiently advanced satire is indistinguishable from reality." - [Tips: 1DrYakQDKCQ6y52z6QbnkxHXAocMZJE61o ]
1. Re:The 1% users fault. by Hognoxious · 2010-02-09 23:36 · Score: 1
  
  PayPal pretends to be a cash transfer service, not a Bank.
  Oh, they're a cash transfer service alright - from buyers and sellers to themselves.
  
  --
  Confucius say, "Find worm in apple - bad. Find half a worm - worse."
It's about two things. . . by Fantastic+Lad · 2010-02-09 22:17 · Score: 1

Number 1:
It's about taxes. When a huge amount of money is moving through a specific channel, the government will always attempt to tax it.
Number 2:
It's about social control. India must be suppressed. Right now, slave labor in India is one of the great engines driving it's growing economy. The longer that lasts, the better India will be off down the road. (The Hoover Dam is an American example; even though it cost a ton of cash, the workers at the time were barely being paid because it was a time in America's history of slave labor. If you tried to build another Hoover Dam today, you probably couldn't afford it because construction workers are unionized and have a standard of living many levels above, "Shanty Town".)
Number 3 (Bonus!):
India's predominant genetics aren't supposed to survive. That's reserved for China. Chinese people make better fear-driven drones than East Indians, or anyone for that matter. East Indians are marked for harvesting. (Or that's my current theory, anyway.) Money being funneled in through the internet increases attraction to the WWW and the ability to get on it, which in turn gives people access to information. Information is power, and India hasn't been sufficiently doped up, brain washed and debt-ridden to be allowed access to power. Heck, they might actually DO something with it!
-FL
Bottom line by sictransitgloriacfa · 2010-02-09 23:29 · Score: 1

I don't know if it's the Reserve Bank of India or PayPal who's most at fault for this situation, but regardless, it's certainly a great way to extend the recession. How many Indian entrepreneurs will go out of business waiting for this to be resolved?
1. Re:Bottom line by Singularity42 · 2010-02-10 02:45 · Score: 1
  
  Slashdot has many American programmers, who would like to have less competition from Indian programmers. Some Slashdot readers are happy at your comment.
Money is a government function by tjstork · 2010-02-10 01:18 · Score: 1

Stopping money flow and financial services innovation is, like Internet censorship,
a symptom of the fundamental conflict between the traditional role the state has expanded
to cover (ie governments) and the transparent, open and global nature of the Inte
What you do not get is that money is an invention of the government, therefor, it has every right to regulate it. Right now, India manipulates its currency such that the price of its workers are at an advantage to the price of work in the west, so as to get more work. The world economy really consists of states manipulating their currency to either work, such as India, or to not work, such as the USA. Right now, a DBA in India might get paid 25,000rs a month, which is roughly 500USD a month based on exchange rates as they are today. Is the work as good as an American programmer, often not, but, is it 1/50th of the price? No, its not. If you put that Indian programmer onsite, they'd get about 2500-5000USD a month, indicating a real exchange rate of 10rs per dollar, rather than 50rs as it is right now. Thus, the whole "Free flow of money" that you advocate is really a sort massive arbitrage by which the third world is made to be enslaved to the west, an effect that perversely winds up bankrupting the west. In this sense, capitalism as we call it today, with all sorts of disparate currencies and currency manipulations, is really just slavery by any other name, with the morally bankrupting effects on all sides of the equation.
Now, if you wanted to have a genuinely deregulated money system, we can, but the USA tried that from the 1860s to the 1890s, when it allowed nearly every private institution to issue its own currency, particularly banks. So you could have bank notes that could and did serve as legal tender, and genuine value of each note, although denominated in dollars, was really depedent upon what the market felt the strength of the bank was. Of course, this notion of value was completely wrong and banks collapsed in the 1890s, and it was only the internvention of JP Morgan - the person - that saved the whole system. He literally sat in a room and decided which banks were solvent enough to save, and which had to collapse, and he saved those banks he felt worth saving from loans out of his pocket. This spectacular display of person wealth and power shocked the left wing, and it was THEY that demanded the creation of a national, federal bank, the federal reserve bank, that would fufill this role. Thus, whereas we had many differnent bank notes, now we have just one, the Federal Reserve Bank Note.
The sad truth about libertarian movements is that usually there is a colossal failure on the part of the private sector that triggered the creation of a new law. WE have the FDIC, because banks failed. We have the Federal Reserve, because banks failed. We have a paper currency, whose worth is based on the whole economy, in conjunction with Federal Reserve management, because gold strikes and silver strikes of the late 18th century also screwed up the value of money. We have regulations on monitoring transactions, because self reporting has previously not been enough to alert authorities of impending collapse. We have SOX, because despite existing laws on the books, business leaders were still not convinced of the need to tell the truth in their reporting.
I mean, I don't like any of these laws, as they are a huge pain in the ass, but as they say, there wouldn't be a law against murder, if people didn't murder, and so it is with financial affairs.

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Currency arbitrate works well.. by tjstork · 2010-02-10 01:26 · Score: 1, Insightful

And don't forget, India was mostly unaffected by our recent economic downturn
Lets not get ahead of ourselves. The reason India is doing well today is because George W Bush lifted the trade ban with India, allowing US dollars to pour into India. This is made easier by the government of India, which essentially is holding the rupee down to 1/5th of what its real worth actually is, through things like paypal.
Don't believe me? Do this experiment. Get a DBA in India. He or she makes about 25,000rs a month. That's $500 a month. But put that same person in the USA, and would make at least 2,500 USD a month. Therefor, there is a minimum error of 2000USD in the conversion of 25,000rs to 500USD.
The whole international exchange system is a joke. We see this in Japan, China, India... really, the whole idea that the free market can accurately price foreign currencies relative to each other is a colossal and complete joke. When the government can print or dig for money, it can make its exchange rate be anything and so the markets aren't really pricing the relative values of currency, as much as they are pricing what they think the governments will manipulate it as.
But currency prices are not accurate. Prices are not accurate, therefor, there is no free market. The greatest irony of so-called modern capitalism, is that the greatest sources of wealth accumulation change depend entirely on the fact that there is no market at all.

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1. Re:Currency arbitrate works well.. by tjstork · 2010-02-10 02:21 · Score: 1
  
  A Hair Cut in India is 20Rs and I pay the same in US. Going by that the currency exchange should be 1:1. Haha, you are building a long winded response without real merits.
  No actually, you are making my case even more.
  
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2. Re:Currency arbitrate works well.. by Sponge+Bath · 2010-02-10 02:37 · Score: 1
  
  A Hair Cut in India is 20Rs and I pay the same in US.
  45 rupees to the dollar, so this guy claims he is getting a 50 cent hair cut in the US? I guess it involves a bowl or flowbee.
3. Re:Currency arbitrate works well.. by tehcyder · 2010-02-10 03:52 · Score: 1
  
  Don't believe me? Do this experiment. Get a DBA in India. He or she makes about 25,000rs a month. That's $500 a month. But put that same person in the USA, and would make at least 2,500 USD a month. Therefor, there is a minimum error of 2000USD in the conversion of 25,000rs to 500USD.
  
  I think if you extend the experiment slightly you will also find that there is the slight issue that the FUCKING COST OF LIVING IS TOTALLY DIFFERENT.
  
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  To have a right to do a thing is not at all the same as to be right in doing it
4. Re:Currency arbitrate works well.. by tjstork · 2010-02-10 04:39 · Score: 1
  
  45 rupees to the dollar, so this guy claims he is getting a 50 cent hair cut in the US? I guess it involves a bowl or flowbee.
  No, I think he was carelessly saying that a haircut in India is 20Rs and $20 USD, and therefor, the exchange rate should be 1-1. Somehow, that was supposed to prove his point that there was no currency manipulation, but I would actually think that it would prove that there is currency manipulation even more. Or, if not outright manipulation, at least that, the very idea of money being able to measurably and accurate denote the value of a service for purposes of exchanges simply cannot work across international or cultural barriers.
  
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5. Re:Currency arbitrate works well.. by tjstork · 2010-02-10 04:40 · Score: 1
  
  I think if you extend the experiment slightly you will also find that there is the slight issue that the FUCKING COST OF LIVING IS TOTALLY DIFFERENT.
  Yes, and therefor, money is inaccurate. That is my point.
  
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6. Re:Currency arbitrate works well.. by tstubbendeck · 2010-02-10 05:45 · Score: 1
  
  This is ridiculous this has everything to do with standard of living and less to do with currency manipulations. If you go to any country much less developed then the US you will almost always pay lower rates for the same jobs. Its all about opportunity. What DBA in the US is going to work for $500 dollars a month when the minimum wage job at the gas station pays more for that. Where as in a more undeveloped country like India, Sudan, China etc. $500 dollars might be a small fortune.
7. Re:Currency arbitrate works well.. by Jay+L · 2010-02-10 05:47 · Score: 1
  
  George W Bush lifted the trade ban with India
  Which trade ban? (I'm serious; the only thing I can turn up in Google is a nuclear trade ban.) There were plenty of bright Indian DBAs and programmers coming to the US on work visas long before Bush. It was the ubiquity of global high-speed Internet that made it feasible for U.S. companies to outsource the labor instead of import it.
8. Re:Currency arbitrate works well.. by tjstork · 2010-02-10 13:24 · Score: 1
  
  Which trade ban? (I'm serious; the only thing I can turn up in Google is a nuclear trade ban.)
  That was it actually. You couldn't import from India prior to the trade ban. Yes, Indians could come over here, but, prior to Bush lifting the ban, the likes of Microsoft couldn't open up a data center over there and offshore work to it.
  
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9. Re:Currency arbitrate works well.. by tjstork · 2010-02-10 22:23 · Score: 1
  
  This is ridiculous this has everything to do with standard of living and less to do with currency manipulations
  standard of living is a joke. if you think globally than easily you can see that if a man cuts your hair in bangalore he should get paid the same as a man that cuts your hair in the usa, and he's not, because the currency conversion is wrong. If, on the other hand, you repegged 1 dollar to 1 Rs, the guy cutting your hair in bangalore would be getting paid as the same in the guy in the USA, the DBA would make the same, and trade would be fair.
  Really, free trade is just currency arbitrage.
  
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10. Re:Currency arbitrate works well.. by tstubbendeck · 2010-02-11 03:43 · Score: 1
  
  This may be true if Bangalore was right down the street but it isn't its on the other side of the world. When I say standard of living what I mean is there is more money flowing around the US for various reasons, history, infrastructure etc. This gives rise to higher wages more opportunities giving workers more negotiating power. For work that is easily transferred from one location to another such as software development this causes downward pressure on wages in developed countries since this work can be transferred to countries where there is less opportunity and upward pressure on wages where the work is being transferred since not only are they going to be people earning higher wages but they can then transfer then spend the money they earn stimulating their local economy. This doesn't happen overnight though since you have to find people that are qualified to work the jobs you are looking to fill in the undeveloped countries or educate them which all figures into the cost equation for the business. Then you have to take into account other costs of having somebody do work for your business that may be far away such as language, customs, timezones. This is assuming the business owner is in a developed country which is a pretty safe assumption currently since it takes capital to start a business and most capital is currently in developed countries although as globalization continues this will balance out.
11. Re:Currency arbitrate works well.. by tjstork · 2010-02-11 04:26 · Score: 1
  
  globalization continues this will balance out.
  I've been waiting for 30 years for it to balance out, and I don't believe it will any more. All it will ever be will capital moving from one country to the next and there will never be any stability or benefit to the people of the countries that have.
  
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Re:Whats that heading anyways ? by tehcyder · 2010-02-10 04:10 · Score: 1

News if not told clearly can be useless !

Welcome to slashdot, I hope you enjoy looking round on this, surely your first, visit.

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To have a right to do a thing is not at all the same as to be right in doing it
Exactly by tkrotchko · 2010-02-10 05:53 · Score: 2, Insightful

"I'll use PayPal once it is regulated, meself."
So you tie your paypal account to a credit card, and every time you log in they say "Give us all your bank account information, that will be really convenient!".
And you wonder, who are they trying to kid? Paypal answers to no one, and it appears they want access to your bank account not because it's convenient, but because when they deal with a credit card company, *there are federal laws that give you protections that PayPal would rather you not have*.
Like: Right to dispute a charge, and PayPal has to answer within a short time or they lose
Processes that must be followed, or else PayPal loses
And I'm supposed to give that up because... it's convenient? I'll bet a lot of people have linked their bank account to these guys, too. I think that's a foolish mistake. Once they have money from your bank, you're basically screwed. You're at the whim of a low-level clerk at PayPal. Thanks, but no thanks.

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Age of lean governments - not yet by ndverdo · 2010-02-10 07:33 · Score: 1

I use services from India regularly commercially and pay with Paypal as bank transfers have disproportionally too high transaction costs. Without paypal (and there are no other non-obscure options to wire low-value amounts) I simply stop sourcing this route and go elsewhere. Makes me wonder why people don't rebell against paying bureaucrats that despite being well-fed from taxes in the end make them poorer.
1. Re:Age of lean governments - not yet by dooode · 2010-02-10 10:52 · Score: 2, Informative
  
  Well your problems are genuine ndverdo, but imagine some guy XYZ who is using the same route to fund a jehadi outfit for their services in India. Also: i) There is no traceability of the transactions ii) You cannot tax anyone earning any amount in India as PayPal is not a bank. We also don't exactly know the background story. It might be 100% feasible that Indian regulatory authorities might have requested logs of all such transactions and PayPal declined. This happened in Blackberry's case, where Blackberry declined Indian government to track its call data but it allows US government the same. Eventually Blackberry was blocked in India.
PayPal: Systemically dysfunctional to the core. by PhilipCohen · 2010-02-23 14:03 · Score: 1

PayPal and Bill Me Later offer banking-type services, services that would be more appropriately and competently carried out under the auspices of the banking community via their credit card company partners. The simple fact is that without the bankers’ knowledge of the entities involved in the transactions, PayPal, or any other provider, will always be handicapped. Such non-bank providers can never guarantee anything for the buyer or seller. The head turkey at eBay, “Noise” Donahoe, has occasionally talked of the possibility of offloading PayPal because he is just barely smart enough to know that when the major credit card companies do get off their butts and introduce a like card/terminal-less payments system to complement their credit card system, they will do it properly, and the dysfunctional and “clunky” PayPal will then sink like a stone—other than, possibly, on what is by then left of the Donahoe-ever-shrinking eBay marketplace. If this turkey Donahoe has any brain at all he will be actively trying to sell PayPal to the banks to complement their credit card system; but I doubt the banks would want to lower their image any further by associating themselves with the likes of PayPal; not even for a peppercorn consideration would the banks touch such an incompetent amateur operation as PayPal, I suspect. But, does anyone think that “all the banks” are not watching this market segment with interest, and is it possible that it (along with the upstart “Bill Me Later”) could well be having a negative effect on their credit card business? Why would “the banks” not be considering a like system to complement their existing card systems? After all, every internet banking user is already set up to receive such a service directly, efficiently and securely, from their bank. The simple fact is that anything that PayPal can do “the banks” can do better. Do we then need to offer the banks and the major credit card companies another such monopoly-type situation? Ideally not. But, having said that, within the credit card system the individual banks do compete with each other on interest rates, etc. Regardless, it would be nice to have a card/terminal-less system that worked effectively—as does the banks’ credit card system. Regrettably (or thankfully, some would say), PayPal does not have such a partnership with “all the banks” and so PayPal can never offer that same effectiveness. My only surprise is that “all the banks”, via their credit card partners, have not yet announced their own system. When they do, it will be bye, bye, PayPal—you most ugly of children. And, more importantly, we will then have a system that works effectively, just like our credit cards do! PayPal: Systemically dysfunctional to the core.