New Paypal Guidelines for Indian Users

After several changes in Paypal policies & mandates for Indian users in 2010 that affected Millions of users specially Ecommerce store owners, freelancers and several IT & Web development companies n India, 2011 is again bringing new challenges to Indian businesses.

As per RBI guidelines, Paypal India is going to put more restrictions on Indian Business accounts for Paypal payment Withdrawal Timeline to bank accounts and putting slab on MAXIMUM amount that can be received through single transaction. These changes will be in effect from 1st March 2011. As per update from Paypal:


  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.
These changes are severly going to affect Indian companies, specially those dealing on Online Bidding websites such as,,, and many more. For example, as per regular practice, most Web Development companies in India used to accumulate funds in their accounts on these websites and then withdraw them at once. I believe, these companies shall have to redraw withdrawal strategies.
Another question is, whether these Online Service Auction websites will make changes to their withdrawal policies with respect to paypal changes? They should do so due to presence of several Indian companies on their portal. Who know’s..  What will happen to ecommerce stores if the order amount is more than $500? What if a freelancer need a payment for $1000 website development project? Let’s wait and watch..