As for the racism tag, well this is only happening to Indian Paypal users. Had they implemented the same thing universally, I wouldn’t have had any issue, however this is only for Indian users and that to me is a clear sign of prejudice against only Indian users.

After all it is not like that it is only Indian users who abuse this feature to save transaction fee and even if it is the case, they can simply go ahead and remove that feature or levy charges, however going in to my account and taking back the money I had received earlier in the month, well it just shows how much they value my business and I am really thankful that only a small and insignificant percentage of my earnings are routed through them, I cannot even imagine the plight of numerous freelance writers and designers, who earn their bread and butter through it!

(1) Paypal has not come out to give an official stand or let its users understand the circumstances in which they have taken this decision. I would not even want to rule out the hand of GoI here. Just thinking of all possible suspects.

(2) They can’t play with their users’ money. If they want to bring in such rule, they have to give an advance notice of sufficient duration – say two to three months and then apply the rule. They have no right to reverse a transaction from the past. It is like a bank waking up one morning and declaring that they will eat away all your money accumulated in last one year. It almost amounts to fraud.