"Paypal doesn't work in India" statement is not fair. RBI has several guidelines for online transactions of money. It wants to be able to regulate all services that take money out of and put money into the country. Unfortunately, Paypal doesn't want to be regulated by any country but US. You're acting like a bank, and walking like a bank, only online, be prepared to be regulated like a bank. Paypal made a choice that it doesn't want to be a bank. It's not really RBI's fault, while I do think that they have think of some other solution to make people's live easier to accept/transfer money online.