According to the latest update from Paypal, from March 3rd, Indian entities will have only to fill out a 'Purpose Code' which defines the purpose of the payment made to them. It appears that the RBI will still not know who is making the payment, only get an indication of the purpose of the payment from the receiver under the laws of India in order to identify the nature of cross-border merchant transactions. What is not clear, and we've requested Paypal for info on this, is whether businesses will not require an Importer Exporter Code (IEC), which they had mentioned earlier. So you can go ahead and pay the Indian mafia extortion money under Purpose Code "P1006" (management services), and nobody will ever know? Perhaps not: Paypal does say that "based on the value of withdrawal and the purpose code in…
