The reserve bank of India and paypal are at it again, finding new ways to stop hard working small business entrepreneurs…A new rule effective 1 March 2011 will not allow me to SELL products that are worth more than $500 through my Paypal online payment processor.
Lets take a 6 feet bronze statue as example
It costs more than $600, this money directly employs me and 3 order sculptors,people who are totally unrelated to my profession it doesn't stop here it goes on to the bottom of the chain.And what is so different about this scenario is the money comes from outside our own economy.It adds dynamism and stability to the local domestic market that our government never stops to take credit for! but the actual fact is if it wasn't for the private sector and small entrepreneurs we would have still been riding bullock carts.
But why ? Despite of all the odds that are thrown against us, The Indian Entrepreneur has craved a niche for himself in the IT industry and I am not talking about big corporate heavy weights here, I am talking about 100000 or more freelancers, and small firms which provide services such as SEO, Design, Marketing And Others.These 100,000 firms provide indirect employment to thousands more.
For gods sake if we cannot sell a service which costs more than $500? what kinda of rule is that ? PAYPAL needs to a feasibility or any study at all before they implement a rule ? The internet marketers are not saying we need a free ride on a fancy car..Thats the last thing on our minds considering the total idiots who are in decision making roles but atleast some sense must prevail.
I hope some media outlet takes this up and shows the amount of revenue lost for the country and what the impacts are on a regular online retailer!
But anyway PAYPAL should ALSO BE BLAMED!. The over charge their customers for no reason and now they are not going to reveal the information on transactions more than $500, According RBI regulations all transactions more than $500 should be revealed but apparently PAYPAL doesn't what to reveal the information.THEY WANT TO HIDE THEIR VAULT FROM ALL GOVERNMENTS.
Fair Enough That Paypal wants to make money but shouldn't they atleast make an effort to change their processes accordingly to meet Indian governments rules.If you are holding money of Indian Citizens and operate withing India then you are bound to be treated as an Indian Bank…
Indian Banks need to first report their earnings to RBI second atleast give interests to the amount present in Paypal.Paypal fails to do both! So I cannot blame Just RBI..
RBI needs to weigh the PROS and CONS
Paypal needs to look at themselves and decide whether they want to be a BANK or NOT, if not they wont last long…PAYPAL as an organisation will crumble.
Email 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. For further information, click here.
If you have any questions, please contact PayPal customer support by logging into your PayPal account and clicking on ‘contact us’ at the bottom of the page. We sincerely thank you for your patience and continued support.
Sincerely,
The PayPal Team
http://rbidocs.rbi.org.in/rdocs/Publications/PDFs/RBIA1934170510.pdf
Capital base of RBI = Rs.5 Crore only
Thanks for the link man! I knew that the $500 limit is not directly because of RBI but because of PAYPAL.But RBI has asked Paypal to reveal the all info on transactions for any amount above $500.Apparently PAYPAL doesn’t want to reveal this info hence they are cunningly misleading people to think that the restriction has nothing to do with them rather it is entirely due to RBI
Why! Hang those cunning thieves! They don’t want to say how much money they are holding, most importantly, they are loath to part even with a tiny penny that they’re holding… it’s their responsibility to do that, after all, RBI makes sure that Indian citizens are saved from Greedy Bankers and their sometimes awful and harmful practices. To top it off, they’re so malicious, they’re spreading THEIR fault as RBI’s fault. PayPal must be run by Jews.
I completely agree with you but they need to provide a solution as well.Paypal is definitely should be taking the lion’s share of the blame.The point to note here that in the end we are left with no choice to pay our online bills with.
For example I applied for an SBI International debit card so I could use it to pay for my online purchases.I applied on 25th Feb 2011. Now Its been 5 visits and 68 days since I had applied for the card and there is no sign of the card. I am thinking about filling a case against them soon.
Plus now they also a very strict rule of not allocating credit cards for business men. The moment I say business your application immediately becomes ineligible no matter if your monthly income is 10 times more than the card limit.
We dont need any financial help from the government all we are asking is to make sure you provide the services that you already have in a better manner.Atleast make sure your system is in place to fall back on if you are going to make the current system void