Paypal creates more problems for Indian users–Can’t accept payments more than USD 500!


Paypal is not offering any respite to Indian users. I opened my mail-box earlier today and was greeted with following mail from Paypal.



As part of our commitment to provide a high level of customer service, we would like to give you a 30-day advance notice on changes to our user agreement for 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”).

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.

We seek your understanding as we continue to employ our best efforts to comply with the RBI Guidelines in a timely manner.

We regret any inconvenience caused to you and hope the advance notice will enable you to plan your future use of our services accordingly.

The PayPal Team

To put simply, Paypal has now ordered Indian users to not to use any money in the paypal account other than transferring it to your bank account. So lets says you have 50 USD in your paypal account and you want to pay off your hosting services using that paypal money, you are out of luck. You can ONLY transfer it to your bank account..that’s it !

Additionally, as an Indian paypal user, you will not be able to receive more than 500 USD for your work in a single transaction. Obviously, there is a simple work-around to that my receiving payment higher than  USD 500 in Multiple transactions !

All said and done, paypal is making life tougher for its Indian users. We REALLY need a paypal alternative !

  1. […] to RBI guidelines, no transactions above USD 500 dollars can be accepted by Indians in their account. Although, this was communicated to Indian paypal users before, they could still […]

  2. vadivelan says

    I sent money Via PAYPAL India. Shipping detail not yet arrived. I am trying to CONTACT CUSTOMER CARE,, but 1800- 212-3852 does not EXIST reply I am GETTING.



    please advice me how to contact PAYPAL.

  3. Sachin says

    Hi, I am planning to link my website with PayPal. But I am an Indian with SBI account. So is it possible to accept payment from Foreign (Outside India) users? Or is that also blocked by PayPal? Please let me know if any one. Thanks I advance…

  4. Mann Sharma says

    I’m owner of a website and it’s growing $500/pm but i’m in trouble because of fucking Indian PayPal need credit card to do most things….they’re really an ass holes! Mother Fucker RBI!

  5. Daniel Parker says

    This is done all because of tech support callers……bastards becoz of them we have to suffer.

  6. Nieshant Bagadkar says

    how to add funds to paypal? is there offline mode of adding funds to paypal?

  7. SEO Services Chandigarh says

    yes i think, its very true, i read it in many blogs. that there are a limit by RBI, and Paypal have to follow many othere restrictions by india Govt.

  8. Sojan says

    RBI make the 500 USD limit for paypal transactions, but no problem with these huge transactions

  9. Milind says

    There are different problems up front:
    1. The moment I receive any money, it gets uploaded to the Bank, you cannot use it to pay anyone.
    2. On my website, I cannot accept payment from Indian users. RBI guidelines prevent even this.
    3. CCAvenue is there but nothing beats PayPal because it is free. Our government cannot dream of providing anything for free.

  10. Arvind Raman says

    But I think its not paypals fault if RBI is putting up regulations like these. RBI is like a blood sucking parasite, they don't want Indians to transfer USD which comes in as a foreign reserve outside of India. Horrible, we cant buy International stuff which is not available in India, which paypal made relatively easy for us. RBI is a fukup…

  11. MREs For Sale But Not In India says

    Have any of the other countries implemented these kinds of changes in their Pay Pal policy or is India the only one? Why India and not England for example? Does anyone have a good answer? I think the answer may be in finding another payment processor other than Pay Pal? Does anyone have a suggestion for an alternate payment processor?

  12. Dinesh says

    This was created by the RBI, the Indian Government sucks man. What Paypal does just because they have to follow the rules. I’m a freelancer and receive money via Paypal but If I need to buy some snippets, scripts like that I cannot pay via Paypal because we ppl are not allowed to buy goods using our Paypal money, that’s truly sucks man.
    Paypal rocks but this government needs to think about their people. What about the money they have in swiss banks, aren’t that foreign currency , now where the rules and laws gone, they are suckers..

  13. Austin Power says

    yeah same fu.cked wid this crap….no wam not able to make payment to my hosting :X

  14. Rimple Sanchla says

    Need a solution for this man………

  15. Mahesh says

    Means Won’t I be able to buy domains from my PayPal money?

  16. James says

    I have been helping people in India solve the Paypal problem through setting up a Hong Kong company which has a Hong Kong bank account tied to a Hong Kong Paypal account which can be operated remotely by the user in India.

    1. q says

      that sounds like money laundering and tax evasion. Actually people are better off using hawala..that way you know you will get arrested sooner or later for money laundering.

  17. Matt says

    I just wanted you to share this petition with you entrepreneurs, Bloggers & Freelancers.
    Please support us and help us spread the word.

  18. Amaron says

    Please fill up this petition and protest against the new RBI-Paypal notification.

    Also, lodge an RTI complaint over here.

  19. Shanmugam says

    Paypal will loose a lot of business because of this…I have been depending Paypal. for paying for web hosting and for receiving money for my freelance work.. I think Alertpay will use this opportunity to get some business..

  20. Abhishek Bharadwaj says


    Here is a simple catch for this problem.

    I hope it can help to minimize the impact on your business. Please let me know if you face any problem after following this strategy.

  21. dpi says

    For the Paypal’s issue, RBI pushes everyone who want to pay the services/purchase from foreign entity, must use Credit Card. There is a lot of small time freelancers are not having Credit card. There is going to be lot of problems…

  22. dpi says

    Paypal sucks but RBI REALLY SUCKS. RBI insisting that every foreign payment even in small amount should come to bank account. But it wont allow to pay a foreign payment easily. Payment to foreign services like Hosting etc are very small in amount. To pay for those service in absolutely not possible from bank.
    These idiotic polices will affect large number of Web, IT, Design, Copy Writing service providers so much. They can’t afford RBI’s bull@#%T policies only suitable for biggies who is doing business in multi crores.

  23. Jagannath A says

    a paypal alternative cannot solve this problem. it’s the RBI’s foreign currency guidelines stuff.

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