After falling foul of regulators in India earlier this year, PayPal has been forced to suspend personal payments in Japan ahead of new rules set to come into play on 1 April.
This is ovious that all the multinationals should comply countries local regulation before doing any business. However, what I suggest Paypal is that it would be more startegic for them to start business with local tie up (having local partner) as this will
significantly reduce their business operation cost. Also local presence have much more impact on brand awarness, business development and customer services. For these type of P2P transfers, instead of offering services in developed countries where they already
have tough regulations, Paypal can target lot of other developing countries, where they will be heartily welcomed to operate their services.
I don't know about Japan but there has been no recent change in regulation in India as regards inbound cross-border remittance licensing. According to PayPal's own communication to its customers in India - I being one of them - "the RBI has told us that
PayPal needs specific approvals to allow personal remittances to India, which we currently do not have. Until we get these approvals, personal payments into India will remain suspended." It seems like PayPal did business without a license all these years.
It's just that its non-compliance with pre-existing regulation got exposed recently.
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