Popular online payment processing service PayPal last month had stopped all personal payments to and from India. With this action, PayPal also suspended all bank withdrawals to India. PayPal took these steps to meet the requirements set by the Reserve Bank of India (RBI), the federal bank of India. This move affected many, specially those who offer various online services from India and also those who make money online with their blogs.

PayPal

Now, the good news is that from March 3, 2010, PayPal may allow Indian users to withdraw funds to their bank accounts. In a new blog post, Farhad Irani, head of PayPal’s Asia Pacific business, wrote: “We expect to resume the service on March 3rd”. But now Indian users are required to fill out a new field entitled ‘Purpose Code‘ while using the ‘Withdraw Funds’ option. The purpose code is something that helps Indian bank furnish information that may be required by the RBI to identify the nature of the cross border transaction. Yes, PayPal transactions became a bit complicated and if you want to withdraw money to your bank account, you must follow what RBI directs.

The Purpose Code is different for different category of service providers. According to the PayPal Blog, following are the different purpose codes:

• P0101 and P0104 : For eBay merchants, jewelers, sellers of collectibles and other such products through eBay and your own websites or catalogues globally.
• P0301: For Online Travel Agents, Airlines, Railways, Buses, Taxicab Services, Hotels, B&Bs and other travel or tourism related sales through PayPal.
• P0801, P0802 and P0803: For an independent freelance coder, hardware consultant or data processing service provider, or a small business providing such services for websites globally.
• P0805 and P0806: For freelance journalist, blogger and news aggregator. Code 805 for freelance journalist or blogger and 806 for newspaper or new aggregator.
• P0902: For artists, designers, other creative service providers where the principal revenue mode is license fees.
• P1004: For providers of outsourced law related services.
• P1005: For accounting consulting and accounting services.
• P1006: For Management and brand consulting and management services.
• P1007: For Marketing/ brand consulting, logo design and event management services.
• P1008: For outsourced research and development services providers.
• P1009: For other technical services such as eTutoring, education and other services provided over the internet via web conferencing tools or similar channels.

So, Indian users may withdraw their money after March 3. Good luck to all Indian readers who were desperately waiting to withdraw money. But don’t forget to use the proper ‘Purpose Code‘. In case you are not sure about the right code, don’t hesitate to contact PayPal support team.

The PayPal Blog Post Link: https://www.thepaypalblog.com/2010/03/new-bank-withdrawal-instructions-for-our-customers-in-india/