Seems like PayPal and Indian bloggers have love and hate relationship. Earlier Paypal imposed some new rules for Indian PayPal users. One of them was withdrawing money from PayPal account to bank account within 7 days. Though I faced no issue with this feature and seems like PayPal has come up with another solution to make it mandatory for Indian users.
PayPal started offering automatic withdrawal for Indian users. Interesting thing is, apart from FAQ page PayPal has not made any official statement or comment regarding this new Auto withdrawal feature.
How to use PayPal auto withdrawal feature?
Login to your PayPal account and hover on Profile link and click on add/edit bank account. (See screenshot)
On the next page select bank account or you can click on Add bank account to add a new one. In my case I selected my existing bank account and clicked on make auto withdrawal.
Though there are many unanswered question like What will happen if withdrawal amount is less then 7000. (Update: See below for an update on this). As Paypal charges INR 50 for withdrawal amount on 6,999 or less. I believe we will have answers to such question soon. Another drawback is now we can’t hold money in our account to wait for good foreign exchange rate. We will cover more on this But for now I suggest you to check out FAQ page from PayPal.
PayPal FAQ page has added some information regarding the auto withdrawal feature for Indian users.
Here is useful excerpt from the FAQ page:
What is auto withdrawal? Auto withdrawal is the process of automatically transferring your funds from your PayPal account into your bank account in India. Where will my funds be auto withdrawn to? Your PayPal balance will be auto withdrawn to your bank account in India. If you have one bank account added to your PayPal account, it will be set as your auto withdrawal account. In case you have more than one bank account added to your PayPal account, you will have an option to set your auto withdrawal account. Why are my funds being auto withdrawn? This is an Indian regulatory requirement and applies to all PayPal users in India. When does auto withdrawal happen? Your PayPal balance is auto withdrawn to your local bank account in India daily. You can check your bank account within 5-7 working days after your funds have been auto withdrawn from your PayPal account.
Another news is Indian Paypal users still can’t use their money in PayPal account for any purchase and with this new changes, I believe we don’t expect it be back again for Indian users. So any money receive on your PayPal account, Indian users can only withdraw it directly to bank account.
Though it’s sad to see PayPal dying in India and especially when it’s considered as one of the standard for online payment. Anyways I will keep you updated with latest and update on PayPal and India Love hate relationship. For now you can check out Alternatives site to PayPal.
Update: So finally we got answer to some of the unanswered questions and first of them is there will be no withdrawal charges for Indian Paypal users. No matter how much amount it is, it will be withdrawn into your bank account without any charges.
Though for newbie PayPal users, you need to have your PayPal name and bank account exactly the same, else you won’t be able to link your bank account. In case, if you have used misspelled name or nickname, you can contact PayPal and provide them with PhotoID proof and they will update your profile to match your bank account name.
So if you are an Indian PayPal user, you need to update three things in your account instantly: Pan, Bank account and Paypal purpose code.
It’s good to see that PayPal has made things clear now and despite of all the restrictions like we can’t make Payment using existing credit on PayPal account, I believe as a webmaster we will continue using it, since it’s a standard mode of Payment globally.
What’s your take on new withdrawal policy of Paypal for Indian users?
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