New PayPal Rules For India Could Impact Online Diamond Transactions
February 02, 11
(IDEX Online News) - In a move that could impact online diamond transactions, online payment service PayPal has instituted new rules for its Indian users to comply with Reserve Bank of India (RBI) regulations.
The new PayPal rules are:
- All users have to transfer any money in their PayPal accounts to their own respective bank accounts within seven days of completion of a transaction.
- All transactions have to be under $500.
The move is not in response to any new regulations from India’s central bank, but is instead in order to allow PayPal escape the need to be regulated like a bank.
RBI rules stipulate that any institution that keeps third party money for more than a week must be subject to banking regulations. Also, any entity that brings more than $500 into the country is obliged to report the transaction to the RBI.
By instituting its new rules for Indian users, PayPal does not come under any banking regulation requirement and is not obliged to report its transactions to the country’s central bank.