Most of the Indian Paypal users have gone through a rough time when Paypal suspended its services temporarily in India. All of us know that this was due to the question Indian Regulators raised on the way Paypal Operated.
After a month of tussle the issue seemed to be over and Indian users were no longer allowed to use the Personal Payments option. Personal Payments were stopped as they fall under the category of “inward remittance” and Paypal does not have the license to run such a service in India.
We heard on the official Paypal blog that things are now settled and people can now withdraw money to their bank accounts like before. There was just a small modification in the process of local bank withdrawal with the introduction of a purpose code associated with the withdrawal process.
But, now it appears that the operations of Paypal India are again under the scrutiny of the Government of India and if Paypal is not able to satisfy the regulators, be ready for another glitch.
According to Jaimon Joseph, an IBN Live correspondent, on his blog, if Paypal is not able to submit themselves to the scrutiny of the RBI, the services may be pulled up once again.
All money flowing across our borders is subject to two major laws. The Foreign Exchange Management Act (FEMA) and the Payments and Settlements Act of 2007.
If Paypal is not able to satisfy all the details by 30th April, it may be another setback for the Indian Users.



March 22nd, 2010
Saurabh Dutta
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