PayPal to stop domestic payment services from April 1; plans to help Indian economy grow

Digital payment solutions provider Paypal on Friday said it will stop offering domestic payment services within India from April 1. The United States-based firm will instead focus on enabling more international sales for Indian businesses. The company noted that it had processed USD 1.4 billion worth of international sales for over 3.6 lakh merchants in India last year.

"From 1 April 2021, we will focus all our attention on enabling more international sales for Indian businesses, and shift focus away from our domestic products in India," the company said. "We will continue to invest in product development that enables Indian businesses to reach nearly 350 million PayPal consumers worldwide, increase their sales internationally, and help the Indian economy return to growth," a PayPal spokesperson said.

The spokesperson explained that this would mean PayPal will no longer offer domestic payment services within India from the said date, news agency PTI reported. PayPal can have the greatest positive impact in India's economic recovery by pivoting its business to support customers where they need the company most, the spokesperson said. Paypal was one of the payment options on platforms like Swiggy and BookMyShow.com.

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HC seeks FIU stand on PayPal plea

Last month, the Delhi High Court sought response of the Financial Intelligence Unit (FIU) India on American online payment gateway PayPal's plea challenging the Rs 96 lakh penalty imposed on it for alleged violation of money laundering law. Justice Prathiba M Singh issued notice to the FIU and sought its stand on PayPal''s plea by February 26.

The court also stayed the FIU order subject to PayPal maintaining records of all its transactions and depositing within two weeks in the High Court a bank guarantee of Rs 96 lakh. The court also made the Reserve Bank of India (RBI) a party in the matter.

It directed the RBI and the Ministry of Finance to constitute a committee of its representatives to take a policy decision at the highest level on whether such an entity can be considered as a reporting agency and would they be governed by the Prevention of Money Laundering Act (PMLA).

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