PayPal has chosen to reverse all personal payments to and from Indian paypal accounts. The following is the standard email notification that the receiving parties are getting:
Hello <user>, Your payment of <xxx> has been sent back to the sender of the payment. We reversed this payment because we have stopped allowing personal payments to be sent to or from India. If this was a payment for a purchase of goods or services, and not a personal payment, then you may contact the buyer and have him or her resend the payment as follows: (a) click the Send Money tab, (b) select "Goods," and (c) provide a shipping address. If this payment was a personal payment such as a gift, then we have requested that the sender find another payment method until we restore personal payments to and from India. We are trying to resolve this issue as quickly as possible and we're sorry for any inconvenience. Thank you, PayPal
The known date for the earliest transaction reversed is 1st Feb 2010. DigitalPoint thread “India: Paypal Returning payments?” and several others are actively discussing this topic. We tried to reach the Singapore PayPal customer service and inquired if there was any policy change, documentation, notification published or sent to the user. However they referred us to the US customer support which currently is offline till the regular business hours resume. Several paypal users who received these payments report their account balance going into negative.
Update 1 —
Dear <user>, Thank you for contacting PayPal. I understand that you want to know why the payment you received for $<xx.xx> USD from <user> is reversed. This payment was sent as Personal. We have stopped allowing Personal Payments to be sent to and from India. We are aware of this issue and I sincerely regret the inconvenience it has caused you. We are trying to resolve this as soon as possible. Below are the details: Personal Payment - Send Money for India Accounts · India customers are no longer able to see the option to send a Personal payment on the Send Money page · They can continue to use other payment options, such as eBay checkout. If this was a payment for a purchase of goods or services, and not a personal payment, then you may contact the buyer and have him or her resend the payment as follows: (a) click the Send Money tab, (b) select ‘Goods’, and (c) provide a shipping address. If this payment was a personal payment, such as a gift to a friend or family member, then we request that you find another payment method until we restore personal payments to and from India. Although India customers are unable to send Personal payments, they are still receiving Personal payments from Non India customers. · In order to stop ALL Personal payments TO and FROM India accounts, we have started reversing Personal payments sent by Non India customers starting today. (the only exception will be in cases where the buyer has included a shipping address – we don’t want to delay any shipment of goods) · Emails will be sent to both sender and recipient to let them know why the money was returned and what options they have to proceed forward. (see attached for examples) · We are also in the process of implementing a change on the website to automatically stop the payment from processing, rather than waiting to reverse the payment. We will send you additional updates as soon as we have more details. The Personal payment option on the International Send Money page has been updated and India has been removed from the ‘select a country’ drop down list. · If the payment was for a purchase of goods or services, and not a personal payment, then the buyer may resend the payment to the seller by following these steps on the PayPal website: (a) click the Send Money tab, (b) select ‘Goods’, and (c) provide a shipping address. I'll be glad to hear from you if you need clarification, please email us again and we will try our best to give you immediate answers. Thank you for choosing PayPal for your online payment needs. We appreciate your business. Sincerely, Dayna PayPal, an eBay Company Copyright© 2010 PayPal Inc. All rights reserved. Consumer advisory: PayPal Pte Ltd, the Holder of the PayPal™ payment service stored value facility, does not require the approval of the Monetary Authority of Singapore. Consumers (users) are advised to read the terms and conditions carefully. Got more questions? You'll find answers at our improved help center. Click "Help" on the top right corner of any PayPal page to get started or you can visit www.PayPal.com/101. Original Message Follows: ------------------------ Form Message customer subject: Clarification on personal payments being reversed. customer message: Transaction ID: 'xxxxxxxxx' Additional Information: 'The payments we receive are being reversed. Can you please clarify your stand on "personal payments" to and from India? What is a personal payment? We accept donations for our free software. What is the solution/workaround for this issue?'
We’ll keep this post updated with the latest so keep watching this post for more information. You may want to digg this story and spread the news. Also read PayPal Debacle: 15 Lessons Learnt.