Indian Citizens are subject to Exchange Control. It need permission for having a foreign bank account. Funds can be sent abroad for approved purposes and parking of funds, in any kind of account needs permission from RBI, see http://www.rbi.org.in/
On the other hand, services like Paypal are being used in India and I do not think anyone is bothering to take approval. In fact, people don't even seem to be aware that there may be a requirement. And the Paypal transactions seem to be small enough, so that they seem to have escaped regulator scanner.
My question is, Is it technically illegal to transfer money into a Paypal account or even to open a Paypal account (if it is to be deemed a bank account), as per current RBI/FEMA guidelines in India?
Those who have started to worry...note that even if it is illegal in India...max. you get is a fine three times the size of transactions plus interest from the date of transaction, under FEMA. It is not a criminal offence under FERA anymore.
2006-12-27
00:20:17
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5 answers
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asked by
Sanjay Arora
1