RBI Guidelines had made sure that any money which you receive in your PayPal is not spent anywhere. Instead, PayPal India will do an automatic money transfer into your default bank account. Apart from that, you will also have to mention the Purpose code for every transfer you make in your bank. If your source is mostly the same, then you can set up a default purpose code.
- You cannot buy goods or services with the amount you receive in your PayPal.
- So what will you do with that money? You should transfer to your bank account in the next seven days.
- If you sell products that are priced more than 500 USD, you can’t use PayPal as a payment gateway.
PayPal India does automatic money transfer Bank Account
Point 1 and Point 3 are obvious, but what will happen if one does not transfer money to Bank Account in seven Days? Will they suspend the account ? or will the money be held up? PayPal should add this answer in addition to the FAQ.
However, the catch is the money which you receive as a part of goods or services should only be transferred. So if you have earned money as a Gift, that should not be a problem.
Q: Why will PayPal not allow me to receive more than US$500?
Starting 1 March 2011, PayPal customers in India are now allowed to receive $3000 per transaction. Make sure to enter PAN details and the purpose for which the money is collected when you transfer money to the bank account.
Q: Why will PayPal not allow me to keep money in my PayPal balance?
Starting 1 March 2011, PayPal customers in India will not be able to keep money in their PayPal account balance. Instead, all money received into a PayPal account must be transferred to a customer’s India bank account within seven days from the receipt of confirmation from the buyer in respect of the goods or services. This change is to ensure that we continue to comply with the RBI Guidelines.
Nowadays, the transfer happens every day if you do not do it manually. Just like Google Pay, Amazon Pay, and other PayPal now can be used to make payment at any Indian merchant website but, you cannot use the money you receive in your account from outside India. You will have to transfer it to a bank account; if not, it will automatically happen in 24 hours.
Q: Will, my customers, be able to complete their checkout with their PayPal account balance?
You cannot transfer money from PayPal Indian account to another PayPal Indian account. Customers will need to link a credit card to their account before sending you money with PayPal or making a payment. This change is to ensure that we continue to comply with the RBI Guidelines.
Q: The customers on my website are not able to complete a purchase or pay via PayPal. Why?
Starting 1 March 2011, PayPal customers in India will not be allowed to receive payments for any export-related goods or services for an amount exceeding US$500 per transaction. If you are listing products higher than US$3000 per transaction, then you may need to seek alternative methods of payment. This change is to ensure that we continue to comply with the RBI Guidelines.
Related: How to get PAN and TAN Card online
Q: What is meant by receipt of confirmation from the buyer in respect of goods and services?
As an exporter of products or services abroad, you need to ensure that your buyer has received the product or services as per specifications set out on your website. As an exporter of goods, you may withdraw the balance to your bank account in India upon reasonable consideration of shipping time and other clearances such as excise and customs for the destination country. As an exporter of services, you may withdraw the balance to your bank account in India upon receipt of payment from your buyer into your PayPal account.