“Pay with PayPal” you must have heard these words a lot, especially when you are intending to buy any product from an international website or dealing any business internationally.
PayPal is a payment gateway and mode of transferring money when dealing with foreign customers or vendors.
Almost 98% of the people around the world use it as their mode of transferring money.
The main purpose of this use of payment gateway is because it’s free of cost. Also, it is prevailing in the market for a long time.
Even as an Indian citizen, one while buying products from another country might have seen that most of the merchants use PayPal as a mode of payment.
PayPal is the easiest and cheapest way of payment gateway around the world. But still in India “Pay with PayPal” means you cannot buy this product because this service is almost not available to the general users for some restrictions.
The reason for PayPal not operating in India properly is for some restrictions imposed by the Reserve bank of India (RBI).
The Indian Central Bank has imposed restrictions on PayPal because of which it is difficult to use it by the public. Because of which, advantage of “pay with PayPal” is not available in India.
The reason behind these restrictions stated by the reserve bank of India is to protect the Indians vendors and buyers from money laundering issues. But in fact, these issues still prevail in the Indian market if RBI notices it.
Following are some solid advantages which prove that “pay with PayPal” is the best mode of payment to use;
According to RBI PayPal does not have the Indian banking license to operate in India, as it is the government requirement for any authority to hold the money.
Following are some rules set by RBI for using it in India.
Because of the above restrictions imposed by the reserve bank of India. PayPal has limited its operation for general Indian customers. These were the rules this payment gateway has to follow; otherwise, they could not run businesses in India.
Another problem facing by PayPal user is the chargeback. What is it? Well, when a customer opens a dispute and is not satisfied with the product, then they demand a return or a chargeback. Here, the amount will automatically be deducted from your account. In case you face over one chargeback then the amount deducting from your account will be increasing. Other reasons for chargebacks are, damaged products, products not the same as expected, never received and if a credit card is used for fraudulent activity, then cardholder may also file a chargeback.
To check whether they warranted the chargeback filed, one can review the changes and if it is not warranted then the vendor can file a case against the cardholder company as for why the bareback was not warranted.
The company will interrogate the whole situation and see whether it is valid. If it is valid, it will proceed with the chargeback otherwise it will close the case of the same.
Until they resolve the case PayPal will hold the funds of the account. This process may even take months to solve the issue. If they resolve the issue in the favour of cardholders, then cardholders receive his refund.
To save the company from any fraudulent transactions and verification of the customers using PayPal the process of KYC is there to help you out.
However, there are limitations to it. First, there is always error related to the mechanism of the system because PayPal does not verify the customers manually instead they rely on the system itself. Setting up an account requires an email address, credit card number, and bank account number which itself is verification i.e. from the bank. KYC means not only verifying the name of the holder but also it checks the previous transaction history of the client.
It also helps in the verification of multi-currency transaction checking and the rules imposed that the client must adhere to.
Know Your Customer features help the customer and vendor to save them from and mishap, fraud or money laundering issues. The customer support system on the website is always active to answer the queries of the users.
Even though there are many restrictions imposed the RBI on the PayPal services in India still its uses and benefits are many. It’s completely up to you whether to use this service. But if they remove the restrictions on its services, then it is sure that the business sector in India will rise.
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