This is an update on the issue related to the recent changes made by Paypal for withdrawals to bank accounts in India.
I had tried calling Paypal support team and talking to them about the major issue that I found with using Paypal withdrawal into our bank account in India, where it did not get deposited as a foreign income and only got deposited in Indian Rupees as local income – which is really bad for us as we will lose the tax benefits we have when we get foreign income. More this withdrawal issue from Paypal are available in this link.
After 30 minutes of wait, I was directed to a customer service manager called – Rocio who said she is based out of the US and she clarified to me two things:
1. Paypal Regulations Team which sets these policies do not accept any information from customers in any form (email or phone)
2. The withdrawals into bank accounts in India will only come in the form of Indian Rupee.
This only means using Paypal will prevent us from any of the tax benefits we are allowed to receive for bringing foreign income into India. That also means, it is time to stop using Paypal until this changes.
She even provided her employee number to me, which was quite impressive, considering the fact that I clarified to her that we have been able to withdraw from Paypal into our bank accounts in the past as US Dollars – which she says cannot have ever happened 🙂 . I told her that I did not have the time to go back and prove how it was in the past, but want to focus on how we prefer it in the future, if we have to continue using Paypal.
I also stated to her how this issue will impact many other businesses like ours, as we all depend on the foreign income and the proof of it from our banks in India for tax savings, but I guess it did not matter.
She just clarified to my doubts about using Paypal again and as mentioned earlier, we will be stopping using Paypal until this is clarified by Paypal team to us.
I am quite sure Paypal will not be impacted by us deciding to hold off on using Paypal again. At the same time, I can say with confidence that many more businesses like ours will come to realise this issue sooner or latter, and stop using Paypal. Once this issue starts to make a dent in the revenue, Paypal is going to realize that their way of handling the foreign income is definitely putting their Indian business clients at a loss and affecting their revenues.
Good luck Paypal
It was nice doing business with you, will update you if we decide to use your services again 🙂