So far, PayPal’s Indian unit has been focusing on cross-border transactions from India and thus enabling local Indian businesses of all sizes to expand across borders, reach a global network of 173 million customers in 203 countries, and receive immediate payments via PayPal for the goods and services they export.
The company has been operating in India under the Online Payment Gateway Service Providers (OPGSP) guidelines since October 2011. In June 2013, banking regulator Reserve Bank of India (RBI) had increased the limit for export-related payments for goods and services via OPGSP to USD 10,000 from USD 3,000 per transaction.
PayPal has faced issues with RBI in the past. The RBI had wanted PayPal to transfer the money to banks within a pre-determined time frame instead of holding it in its online account. In effect, it only allowed PayPal to function as a payment gateway, limiting the scope of its platform.
India’s ecommerce market is expected to breach the USD 100 billion by FY20, according to Goldman Sachs. The overall online market, including travel, payments and retail in the country could reach USD 103 billion, the US investment bank said.
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