PayPal suspends service in India

Halt temporary while company in discussion with partners and stakeholders to address service issues, says e-payment service provider.
Written by Liau Yun Qing, Contributor on

Online payment service provider PayPal has put some of its services in India on hold temporarily, and is reversing funds requested through PayPal India, according to reports.

PayPal spokesperson from the communications team, Anju Nayar, said in a blog post Saturday that "personal payments to and from India and transfers to local banks in India have been suspended" as the company works with business partners and stakeholders "to address questions they have about the service".

Nayar wrote that customers can still make commercial payments to India, but merchants will not be able to "withdraw funds in rupees to local Indian banks". An Associated Press news report noted that the suspension took effect on January 28.

In Indian blog Pluggd.In which focuses on start-ups, writer "manish" posted last Friday about an e-mail from PayPal saying "funds requested through PayPal India are being reversed to their senders, and users have no access to them".

There's no word on when the suspension will be lifted, though PayPal's Nayar said the company is trying to resolve the situation as soon as possible, and is "really sorry" for the inconvenience visited on its customers in India and worldwide.

PayPal, owned by eBay, boosted the online marketplace's performance in the fourth quarter of last year.

India's retail e-payment market is growing fast with the market forecast to reach between US$150 billion and US$180 billion by this year, according to a report by research firm Celent.

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