This site is an attempt to help sellers/merchants in India find cost-effective and practical alternatives to PayPal for getting payments from International as well as Indian buyers.
PayPal has been a very popular payment gateway option for freelancers and small and medium enterprises in India. Some of the main reasons for this have been
a) Ease of setting up an account
b) Ability to target a global market
c) Ability to integrate easily into any website
RBI has been trying to enforce stronger regulations related to financial institutions to bring more transparency in the system and to prevent the spread of black money. Some of the regulations pertain to PayPal as well although they are not quite a banking establishment like normal banks. To work out of the legal implications of being considered a banking establishment PayPal has come up with a couple of restrictions on their offerings to Indian users. These were
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.
Sometime in 2010 PayPal had stopped allowing PayPal transactions between users in India but that was something people could live with. However these two changes have effectively crippled the usefulness of PayPal as a payment gateway for freelancers and small and medium enterprises in India. This was communicated to the users in an email sent out by PayPal on 29th Jan 2011.
However this is not the end of the world for online payment options for freelancers and small and medium enterprises in India. There are several alternatives to PayPal as listed above.