Paypal-purpose-codeFarhad Irani from PayPal team has come up again with a wonderful news for Indian PayPal users. He confirmed that there is no need to  get an Import Export code [IEC] for withdrawing funds from their PayPal account to Indian Bank account. The only thing required now is a Purpose code which is way different from an IEC code.

What is PayPal Purpose code?

Purpose code is a five digit alphanumeric code which is to be entered while withdrawing funds from PayPal to your local bank account. This code helps your bank provide information required by the Reserve Bank of India [RBI] to identify the nature of transaction. Well yes, this is the new Law by Indian Regulators.

How to get Purpose Code for PayPal Account?

Well, Purpose Code is not same as IEC (Import Export Code). PayPal requires a small five digit alphanumeric code which gives information about the transactions you have made in bank account to PayPal, Banks & Indian Regulatory. There is no need to make any real efforts to get the Purpose Code.

Just wait up to 3rd March 2010 for requesting withdrawal to your bank account along with a PayPal purpose code relevant to your business. You can find the list of the purpose code required by PayPal here.

Code

Category

Description

Who should be using it

P0101 / P0104

Export of Goods

Value of export bills negotiated / purchased/discounted etc. (covered under GR/PP/SOFTEX/EC copy of shipping bills etc.)

eBay merchants, jewelers, sellers of collectibles and other such products through eBay and your own websites / catalogues globally.

Please note: Cross border shipment of goods and services for which you file GR / PP / SOFTEX / EC forms only should be processed with this code. Use P101 if Deutsche Bank is your banker and P0104 if you bank with any other bank

If you have any questions, please check with your bank to help you with the same.

P0301

Travel , Hospitality and Tours

Purchases towards travel (Includes purchases of foreign TCs, currency notes etc over the counter, by hotels, hospitals, Emporiums, Educational institutions etc. as well as amount received by TT/SWIFT transfers or debit to Non-Resident account).

Online Travel Agents, Airlines, Railways, Buses, Taxicab Services, Hotels, B&Bs and other travel / tourism related sales through PayPal

P0801

P0802

P0803

Information Technology

Computer Information Services. Hardware / Software / Data Processing consultancy/implementation

If you are an independent / freelance coder / hardware consultant or data processing service provider, or a small business providing such services for websites globally, please use these codes.

For all IT related consulting services where you know you do not need to file a SOFTEX form, please use the appropriate code. 801 for hardware consulting, 802 for software consulting and 803 for data management and processing consulting services

P0805

P0806

Content and Journalism

News Agency and Subscription services

If you are a freelance journalist / blogger / news aggregator please use this purpose code for withdrawals.

If you are a newspaper or an online news aggregator for websites overseas, please use the appropriate code from these two. 805 if you a freelance journalist, and 806 if you are a newspaper / aggregator

P0902

Licensing of creative works

Receipts for use, through licensing arrangements, of produced originals or prototypes (such as manuscripts and films)

Artists, designers, other creative service providers where the principal revenue mode is license fees, please use this code.

If you produce creative works which you license out for entities overseas, licensing revenues may be classified under this purpose code

P1004

Other services

Legal Services

If you are providing outsourced law related services

P1005

Accounting, auditing, book keeping and tax consulting services

For accounting consulting and accounting services

P1006

Business and management consultancy and public relations services

Management / brand consulting and management services can be exported with this purpose code

P1007

Advertising, trade fair, market research and public opinion polling services

Marketing/ brand consulting / logo design / event management services can be exported with this purpose code

P1008

Research & Development services

If you are an outsourced research and development services provider based in India, receipts can be inwarded through this purpose code

P1009

Architectural, engineering and other technical services

Any other technical services such as eTutoring, education and other services you render over the internet via web conferencing tools or similar channels, please use this code for your withdrawals

At a quick look, it seems like Code P0805 suits me.

If you are not sure about your code from the table above,, please contact PayPal customer support by logging into your PayPal account and clicking on ‘contact us’ at the bottom of the page.

If you’ve already withdrawn your money from your PayPal account prior to March 1st, then you’ll have to wait for few days to get the full amount credited back. [No transaction charges or fees will be deducted]. The initial amount you receive back in your PayPal balance will be less than the amount you withdrew; all applicable fees and charges will be credited to your PayPal account separately. Once it’s fully credited back you can initiate a withdrawal request again to your local bank account providing the Purpose Code relevant to your business.

Note : Also, with this new changes in PayPal now PayPal cannot be used for Charity and Donations in India, as there is no Code for Charities.

Related : Register or Buy Domain in ANY LANGUAGE (NON LATIN, NON ENGLISH)

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