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Indian PayPal users need to supply Purpose Code

By Ricky on March 2nd, 2010 

A few days ago, PayPal announced that they will be resuming their operations in India. They pointed out that publishers will need to provide the Importer Exporter Code (IEC) withdraw money from their PayPal account. In an update in the PayPal blog, Farhad Irani, who is in charge of PayPal India, clarified that it is the Purpose Code not the IEC that will  be required for withdrawal from PayPal.

What is Purpose Code?

The Purpose Code helps the bank to which we are withdrawing furnish information that are be required by the Reserve Bank of India to identify the nature of the cross border transaction.

Where can I get it from?

You can get the Purpose Code specific to your bussiness at the Reserve Bank of India's website.

Some common Purpose Code that you may need are:

CodeCategoryDescriptionWho should be using it
P0104Export of GoodsValue 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.

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

P0301Travel , Hospitality and ToursPurchases 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



Information TechnologyComputer Information Services. Hardware / Software / Data Processing consultancy/implementationIf 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



Content and JournalismNews Agency and Subscription servicesIf 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

P0902Licensing of creative worksReceipts 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

P1004Other servicesLegal ServicesIf you are providing outsourced law related services
P1005Accounting, auditing, book keeping and tax consulting servicesFor accounting consulting and accounting services
P1006Business and management consultancy and public relations servicesManagement / brand consulting and management services can be exported with this purpose code
P1007Advertising, trade fair, market research and public opinion polling servicesMarketing/ brand consulting / logo design / event management services can be exported with this purpose code
P1008Research & Development servicesIf you are an outsourced research and development services provider based in India, receipts can be inwarded through this purpose code
P1009Architectural, engineering and other technical servicesAny 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

What if you are unsure of what category you fall under?

If you are not sure which Purpose Code you need to use, you should contact PayPal and clarify from them.

PayPal is expected to resume normal operation in India from 3rd March.


Indian PayPal users need to supply Purpose Code was originally published on on March 2, 2010 - 7:59 pm (Indian Standard Time)