In a flurry of recent developments, PayPal has received an initial approval from the Reserve Bank of India (RBI) to operate as a cross-border payment aggregator in one of the world’s largest markets.
A Tighter Regulatory Framework
In light of this move, the RBI has tightened its regulatory framework for cross-border payments. Companies must now obtain a Payment Aggregator Cross-Border (PA-CB) license to provide these services. Only a few entities—Adyen, Amazon Pay, BillDesk, and Cashfree Payments—have successfully obtained such licenses in the past year.
Recently, Skydo was added to this select group. According to news from the Times of India, PayPal is now set to enter an expansive market that handled $73.8 billion worth of outbound shipments alone in April, spanning approximately 200 international markets.
A Market on the Rise
While cross-border payments have surged globally, many challenges persist, including regulatory hurdles, high transaction fees, slow processing times, and a lack of transparency.
A recent Visa report indicates that 77% of consumers still use multiple payment methods for international transactions. On average, individuals employ four different payment solutions for these transactions, with most seeking out a single provider to streamline their needs.
Strategic Moves by PayPal
In light of these challenges, PayPal has embarked on various initiatives aimed at enhancing its global presence and addressing user demands:
- Collaboration with Coinbase: PayPal struck a deal to eliminate fees for PYUSD stablecoin purchases. This move seeks to boost broader adoption.
- Interest Earnings: Customers will soon be able to earn 3.7% interest on holding the PYUSD stablecoin in their PayPal or Venmo accounts.
- New Ventures: The company launched its first mobile wallet, competing directly with Apple Pay and Google Pay for in-store payments. Additionally, it entered the agentic commerce space by integrating PayPal payments into Perplexity’s AI chat platform.
Should these efforts gain traction, PayPal could strengthen its position in an increasingly dynamic cross-border market environment.
