Why Paypal is suspending personal payments in India?
With the suspension of personal payments by PayPal in India, many Indian PayPal users have nowhere to go with their money blocked or returned and with no alternative to PayPal yet.
It seems quite logical that the step taken by PayPal has something to do with the Indian Government / Indian regulatory. Anuj from the PayPal blog has also confirmed the same that PayPal needs to respond to "whether personal payments amount to remittances into India" asked by the Indian regulatory.
The Indian Government is known to make stupid, idiotic moves remember the above 10,000 withdrawal tax from the ATM’s (you pay tax on your own money that had already been taxed!). The Government is making moves to curb black market and un-accounted money. Even a 5th grade student will tell you that un-accounted money is never deposited in banks. And as if the Government doesn’t know it!.Paypal is not just used for getting money from clients but also for shopping online, but ultimately the balance money in PayPal needs to be transferred to the users bank account and is reflected in the bank statements or credit card statements.
First of all the Indian Government does not have a proper infrastructure in place, forget about identifying a citizen from his/her bank accounts the government does not have even the proper means to identify a citizen in general. For example before every election there are so many errors and candidate names missing even when they have an election card.
It seems the Indian Government regulatory wants identification before every money transfer. And since the government can’t do it they force the service providers in this case PayPal.
If the government has problems with personal payments, well that can also be sent as business payments, so how do you distinguish between them?.
I don’t think it is about black money or un-accounted money as all transactions happen through bank or credit card; it is just that the Indian Government does not know or have the means to track transactions that may be used for terror activities and best option would be to make the service provider accountable for, period.
The PayPal problem in India may take several months and even years (Since the Government is Involved), until then millions of Indians who earn billions of USD every year will be affected.
Our govt. can't stop hawala transactions and yet they are cracking on paypal users :-(
By » Mohammed on 2010-02-10 21:52:56