Legal Question in Banking Law in India

I run a web hosting service. Most of our customers are in USA and also vendors are in USA. We need to pay abut 10,000$ USD each month to USA datacenters. We use paypal to make this payment. Are there any restrictions to use your credit / debit card for these commercials payments online ?

1. The payment is made to USA datacenters

2. Payment mode is credit/debit card via PayPal

3. Interestingly, paypal allows to send upto 3000$ per day which is regulated by RBI

4. RBI has a generic rule that says 10,000$ USD is the ceiling per year for online payments.

Since RBI has allowed paypal to be used in India and since we can only use credit/debit card via paypal to make outward payment, i am confused on if there is any restriction.

Bottom line question is, can we use credit/debit card via paypal in India to make outward payment of 100,000$ per year ?


Asked on 12/02/13, 1:25 am

2 Answers from Attorneys

Prima facie there seems to be violation of RBI guidelines and even the FEMA act we at karvai legal solutions can help you conduct legal research on this issue and suggest you legal and authentic way of making online transactions. The issue in your case is not debit or credit card but the payment itself. visit on www.karvai.in for help and support.

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Answered on 12/02/13, 1:33 am
J. Radhakrishnan independent Practice

Better check with RBI's Foreign Exchange Department.

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Answered on 12/02/13, 6:00 am


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