How to Create Paypal Account in India Step by Step & Verify Also (Complete Guide)

If you use internet, some day you are going to accept or send payments. With the onset of online money transactions, having a PayPal account has become a necessity. PayPal is one stop solution for various needs both inside India as well internationally.

As an Indian citizen, there many options to receive payments coming from transactions/order received from Indian customers like Razorpay, Instamojo etc. But when you have an international audience, you need some mechanism to receive payments and then provide products and services.

For this reason, PayPal is so popular among people running drop shipping stores using Shopify, Woo-commerce or Big-commerce. Due to the long history of PayPal, it has established trust also so customers don’t feel its new form of sending payments.

For bloggers, Youtubers and influencers also, you are most likely going to receive payment using paypal only.

Paypal verified

Before I go into full benefits of using PayPal, opening the account and get verified, let me tell you that you can send payments very easily using PayPal buttons on various websites or using send payment feature inside PayPal account. For receiving payments, PayPal wants you to link a bank account so that when any payment is received, they can transfer it to your account.

PayPal also transfers the amount received automatically to your bank account after few days of receiving payments. You can also manually request the transfer by logging into your PayPal account anytime.

Why Own and Use a PayPal account:

  1. It is more secure to use PayPal because all payments can be done only by logging into your PayPal account. And PayPal acts as an intermediate entity between your credit/debit card and the vendor.
  2. Many people in India don’t have a credit card which may require for annual fees. But all of the people have at least ATM card and this ATM card is the bank debit card also. This debit card can be used with PayPal for making payments. For me, I would attach both debit and credit card if I own credit card) to avoid any payment issues in the future.
  3. Its quick way to receive foreign currency, be it dollars, Euro or Pounds. All money is converted to Indian Rupees and sent to your bank account.
  4. For subscription based websites like monthly pay subscriptions, PayPal allows your vendor to add authorization for recurring payments which means you don’t need to remember to pay every month and you can cancel this recurring payment anytime you want inside your PayPal account.
  5. In case you want to send payment to multiple people at once then PayPal’s mass payment feature is quite handy.
  6. For e-commerce products, PayPal will ask for tracking number and then will cross check it.

Steps To Create Your PayPal Account

PayPal is hosted on website and note that the country specific TLD dont work. For anyone located around the world, he/she needs to access PayPal by going to So for this step go to and click on “Sign Up” to start creating your PayPal account.

PayPal will then ask for what type of account you want to make. You can choose between Personal or Business account types. If you have a new business then go with Personal PayPal account and for intermediate/advanced transactions, I would recommend the PayPal business account.

Open PayPal

Fill the sign up form providing the required details like name, address and phone number etc. You can add your VISA/Mastercard details later too as that information is only required for sending payment. For new accounts, PayPal does put some limitations on amount that can be sent and received. With time as the PayPal account gets old, more features are unlocked.

If you want to receive payments via PayPal on your Shopify or any e-commerce website then you have extra steps to complete which are in line with guidelines issued by the Indian Government and RBI to PayPal. These details include:

  1. PAN card details. For huge incoming payments, Income Tax would be keeping an eye on your PayPal account too.
  2. Confirm your email account
  3. Add bank account. PayPal may credit some small amounts in paisa and then ask you to confirm the amounts to make sure that this is your bank account.
  4. The purpose of receiving payments also known as Purpose Code. There is a list of codes and purpose shown to you. You have to choose the code appropriate to your business. For me I have chosen Software sales.

The page where all the required details have to be provided is this page.

PayPal Verification India

How to Link Pan Card to PayPal:

Enter your PAN number in the PayPal website and you are good to go. Do remember that the PAN number you provide here can easily be verified by PayPal to make sure the name on PayPal account and name on Pan Card matches. They may also ask you to provide a photo of the said PAN number.

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How to Link Bank account to your PayPal account:

Even if you won’t be using PayPal to receive payments then also you should add a bank account because when you need it, the process will take a couple of days to get completed.

This process will take 2-3 days if you initiate now, so I suggest you to create your Paypal account right away, as if in future you need to receive money from any of advertising company or client, you don’t have to wait then.

Add Bank Account in PayPal

Click on the link to add Bank account and you will be presented a screen to add in your bank account number, name and IFSC code as shown below:

Bank Details in PayPal

Getting the IFSC code is easy. It is printed on the cheque books of banks and clearly mentioned IFSC code. You can also search for the IFSC code of your bank branch online by searching in google like “HDFC Bank Udyog Vihar Gurgaon IFSC”.

As told above, on adding the bank account, PayPal does verification that the bank account is yours by sending small payments in paisa to your account. You have to tell those amounts to PayPal to verify that you have access to this bank account. When you add bank account, there will be a link next to bank account in PayPal which asks to confirm your bank account:

paypal verify bank account

You Need to Add PayPal Purpose Code:

Add PayPal Purpose Code

Purpose code is important because PayPal needs to consolidate data about each member to know what kind of income is being earned. For people earning advertisement income or affiliate income from Google Adsense, Admob or Clickbank/Amazon/Flipkart etc, the option to be chosen is “Advertising and market research”. Once you submit the purpose code, there is nothing else to be done in terms of verification etc.

As per RBI regulations issued to PayPal, PayPal has to deposit the amount received in account to the bank account on daily basis. We can also request money earlier in the day but it will still take 2-3 days for the process to get completed. Also you cannot use the balance in your PayPal account for making purchases or sending money.

How to Link Your Credit Card/Debit Card with PayPal Account:

Adding the credit card is much easier than adding bank account. The process is very similar though. On adding the credit card, your card is charged 2 times with random amounts. These amounts have to be confirmed with PayPal to complete the linking of cards with PayPal.

When adding the credit/debit card, PayPal will ask for card number, expiry date and CVV number. You may also be redirected to the card manufacturer like VISA/Mastercard for further verification before these random amounts are charged on your card. I have had no issues in linking following bank cards with my PayPal account:

  1. Kotak Bank
  2. ICICI Bank
  3. HDFC Bank
  4. CITI bank
  5. IndusInd Bank

ICICI in particular may create issues which are related to card not authorized to be used online for international transactions. The error which will be shown is:

The bank that issued your card didn’t approve this transaction. Please contact the card issuer’s customer service department if you have any questions. Or you can add a different card now to continue.”

To resolve the issue, you have to call ICICI customer care and request to enable international transactions on your card. This happens with both credit and debit cards by ICICI bank.

For the extra verification done by the card manufacturer, I would advise to set a password with VISA or Mastercard. Or else you will need to request an OTP every time you are doing the transaction.

How to Withdraw Funds from PayPal to Bank Account:

Other Ways to Activate Your PayPal Account:

Credit card:

Getting a credit card could be an issue in many cities in India. If you are working professional in big companies, these banks would visit companies and give credit cards in exchange of showing them salary slips. For others, you can go to bank and get a credit card by starting a fixed deposit. Do note that cards opened via FD can have annual charges as compared to free credit cards offered to working professionals in multi national companies.

As soon as you add the card, a screen similar to following will be shown to you for adding the 2 random amounts which will confirm the linking of your credit card.

Paypal Verify

VCC (Virtual Credit Card) :

Now a days banks are offering VCC which is a virtual card. The purpose of these cards is to hide your actual credit card details. These banks generate a card on demand by using the balance in your bank account. These Virtual cards can also be used with your PayPal account. There are payoneer cards which are used with PayPal by many people around the world (with some tweaks and secret not allowed methods).

Create your free PayPal account

We have given you complete information about opening your PayPal account and then linking your credit/debit card with it. We also covered adding bank account in your PayPal account. The verification is the only process which takes time, otherwise its same as registering on any other website.