PayPal is a worldwide payments provider and yet the details as to why it has shut down its domestic payments business in India are hard to find. While PayPal will apparently continue to operate cross border payments to connect Indian businesses to PayPal accounts worldwide, it will no longer pursue products competitive to Google, Paytm, and PhonePe, along with others.
PayPal has not provided an explanation for this decision, but this 2018 article indicates Apple decided not to enter the Indian market because of government regulations that prevented the use of contactless pinless transactions and the additional requirement that all data derived in India had to remain in India:
“PayPal is shutting down its domestic business in India, less than four years after the American giant kickstarted local operations in the world’s second largest internet market.
“From 1 April 2021, we will focus all our attention on enabling more international sales for Indian businesses, and shift focus away from our domestic products in India. This means we will no longer offer domestic payment services within India from 1 April,” said a company spokesperson.
In a long statement, PayPal said its priorities had shifted in India, but did not elaborate why it was winding down the business. A report recently said the company, which has amassed over 360,000 merchants in the country, was struggling to make inroads in India.
Indian news outlet The Morning Context reported in December that PayPal was abandoning its local payments business in India, a claim the company had refuted at the time.”
Overview by Tim Sloane, VP, Payments Innovation at Mercator Advisory Group
