How to use PayPal in India

PayPal, a global leader in online payment solutions, has shifted its focus in India to cater exclusively to business transactions across borders. Read this blog to know more about usage of PayPal in India.

May 22, 2024
4 mins
blog cover

PayPal, a global leader in online payment solutions, has shifted its focus in India to cater exclusively to business transactions across borders. This move means that personal use for domestic transactions is no longer supported, directing its resources to enhancing services for Indian businesses engaging in international commerce.

Setting Up a PayPal Account in India

Steps to Open an Individual or Business PayPal Account

To begin using PayPal in India, one must first set up an account, which is free of charge. Whether you intend to shop online, work as a freelancer, or operate a business, the setup process involves similar steps:

  1. Navigate to PayPal's homepage and click on the 'Sign Up' button located at the top right corner.
  2. Select the account type: Individual for personal use or Business for commercial needs.
  3. For an Individual Account:some text
    • Click 'Next' and verify your mobile number based in India.
    • Complete the registration steps.
  4. For a Business Account:some text
    • After clicking 'Next', specify your payment reception method and annual sales volume.
    • PayPal will suggest the optimal receiving method.
    • Proceed by entering your email for account verification.

Linking a payment method is the final step, crucial for operational use of your account, either for sending payments or receiving money.

Verifying Your Payment Methods

  • Individual Accounts: Link and verify a debit or credit card by receiving and entering an OTP sent to your linked mobile.
  • Business Accounts: Link your bank account and verify it through the identification of two small deposits made by PayPal, which you will confirm on their platform.

Utilizing PayPal in India for Receiving Money

For businesses, after ensuring your account is set up and verified, you can choose from various payment solutions PayPal offers for receiving international payments, such as:

  • Website Payments
  • PayPal Checkout
  • Online Invoicing
  • Links
  • Email Payments

Businesses can also request payments directly by using the customer's email address through PayPal's 'Request Payment' feature.

Using PayPal in India for Making Payments

While individual accounts can't use PayPal for personal transfers within India, they can make international purchases from sellers accepting PayPal. Here’s how:

  • After account setup, link a debit or credit card.
  • Verify the card to activate payment functionalities.

Business accounts, on the other hand, allow for more direct methods of sending payments internationally using the 'Send' function in the PayPal app or through the website.

Bank Account and Card Requirements

  • Individual Users: A bank account isn't necessary for making purchases; a verified debit or credit card suffices.
  • Business Users: A linked bank account is mandatory for daily withdrawals and managing business transactions.

Fees and Charges for Using PayPal in India

PayPal accounts are free to open and maintain. However, transaction fees are applicable, particularly for businesses. These include:

  • Exchange Rate: PayPal sets its own conversion rates, which may include a markup over the mid-market rate.
  • Transaction Fees: For international transactions, fees are typically 4.4% plus a fixed fee based on the transaction currency.
  • Currency Conversion Fee: An additional 3% fee is charged for converting international funds to INR, applied daily during withdrawals to your bank account.

Current Functionality and Operational Fees of PayPal in India

As of now, PayPal continues to support international business transactions but does not cater to personal or domestic transfers. Business users are subject to various fees based on account activity, while personal users benefit from fee exemptions on account maintenance.

The Bottom Line

While PayPal has discontinued its domestic transaction services for personal users in India, it remains a vital tool for businesses engaged in international commerce. By following the straightforward steps to set up and verify a PayPal account, both individuals and businesses can leverage its robust platform to facilitate secure and efficient global transactions. Businesses, in particular, can benefit from a variety of payment solutions tailored to meet their needs, ensuring smooth financial operations across borders. Despite the fees associated with its use, PayPal's convenience and widespread acceptance make it an indispensable service for anyone looking to connect with the global marketplace.

Frequently Asked Questions (FAQs) About PayPal in India

What is PayPal?

PayPal is a widely recognized online payment system, operated by an American multinational corporation. It offers a secure platform for users around the globe to conduct electronic financial transactions, effectively replacing traditional paper methods like checks and money orders.

Is PayPal currently supporting domestic transactions in India?

As of now, PayPal has ceased all domestic transaction services for personal users within India. The platform has refocused its efforts to exclusively support Indian businesses in managing cross-border transactions, enhancing their capability to engage with international markets.

Does PayPal charge any fees for using its account?

In India, PayPal accounts are free to open and maintain for personal users, with no fees for account maintenance. However, businesses are required to pay fees related to their account activities, such as transaction fees and currency conversion charges.

How much is the currency conversion fee?

PayPal imposes a currency conversion fee of 3% over and above the exchange rate when you convert funds received in foreign currency into Indian Rupees (INR). This fee is applied daily when funds are transferred from your PayPal account to your bank account, as part of their operational process in India.

refer earn
Invest in Indian mutual funds & grow your money
Invest Now
community members
Join our Whatsapp community of
NRIs/OCIs like you
Join Community
AMFI logo
We are a certified Mutual Fund distributor registered with
Association of Mutual Funds in India (AMFI) with Reg. No. 273414
Follow us on
Techbloom India Pvt. Ltd. ( is a company incorporated in Bengaluru. Techbloom India Pvt. Ltd. ( is certified Mutual Fund distributor registered with Association of Mutual Funds in India (AMFI) with Reg. No. 273414
Techbloom India Pvt. Ltd. ( provides platform to invest in mutual funds in India under all the regulated guidelines. Customer(s) funds remain within the regulated environment throughout the investment lifecycle and Techbloom India Pvt. Ltd. ( does not touch or hold customer(s) funds. customer(s) deal directly with a clearly identified regulated entity via iNRI platform.

Mutual fund investments are subject to market risk. Please read all scheme related documents before investing.
Copyright © 2023 iNRI. All rights reserved.