PayPal Thailand has announced on Saturday that customers in Thailand will no longer be able to purchase online or make and receive payments using their PayPal wallet as of March 7.
Paypal, a major online payment provider, recently declared that anyone in Thailand who had a personal account before March 2021 will no longer be allowed to receive payments or maintain a balance on their account beginning on March 7, 2022.
“They will be able to withdraw any balance in their PayPal wallet to their bank account,” the announcement said.
“Consumers in Thailand will still be able to make payments using a debit or credit card to merchants which offer the Guest Checkout function. New account registration for consumers will not be available until further notice.”
PayPal Thailand also announced that, from March 7, current PayPal accounts registered to freelancers, casual sellers, and entrepreneurs/sole proprietors in Thailand will have restricted functionality, with the exception of bank withdrawals. Until further notice, new account registration for freelancers or casual sellers will be unavailable.
“For many months, we have been working diligently on the relaunch of PayPal in Thailand. As a locally-licensed payments provider, we have been gradually updating our products and processes to ensure we comply with all applicable Thai laws. We had hoped to start welcoming more Thai customers in the next phase of our relaunch this March,” explained the company. “Regrettably, we need more time to reach this next phase and to extend our services further in Thailand.”
Changes that will happen as Paypal Thailand terminates services
The action effectively implies that PayPal will no longer be available to Thai users with personal accounts beginning March 2022.
People who rely on PayPal to accept payments from abroad will no longer be allowed to do so unless they have a registered business account.
Online teachers, freelancers, digital nomads, and even Thais who use PayPal to collect payments and funds from friends and relatives in other countries will have to look for an alternative.
People will need to register with the Thai government’s Know Your Business (KYB) system in order to open a registered business account.
To open a business account, applicants must provide their 13-digit registration number, as well as the identity papers of any company shareholders holding more than a 25% ownership in the firm. Furthermore, everybody authorized to access the company account is needed to produce identity papers.
Furthermore, all corporate transactions will be subject to a 7% VAT, whilst domestic transactions can only be done in Thai baht and must be connected to a Thai bank account.
Business clients will also be unable to move funds between bank accounts in the United States.
Paypal Thailand is doing everything to relaunch services
The action follows the Thai government’s revamping of the country’s fintech regulatory framework.
This implies that PayPal Thailand is now required to follow a new regulatory framework in order to operate in Thailand.
However, internet conjecture suggests that the decision is related to Thailand’s crackdown on money laundering.
PayPal Thailand said last year that it would no longer accept new account registrations from Thai residents.
“PayPal is preparing to relaunch services in Thailand. If your account was opened prior to March 7, 2021, you will need to take some action to continue using your account in Thailand,” the company says on its website.
The business stated that it is working closely with Thai authorities to expedite its relaunch and minimize consumer interruption.
PayPal Thailand appears to be befuddled by Thailand’s efforts to change its legislative structure in order to advance financial technology and transition to a digital economy.
In other words, in order to operate in Thailand, PayPal must follow Thai law, including anti-money laundering and tax rules.
Why did Paypal Thailand’s plan for return of services change?
Paypal has been working hard for several months to reestablish its fintech operation in Thailand as an approved payment service provider within the country. The company says that it is progressively reopening and enhancing its goods and procedures to guarantee that it is in compliance with all Thai legislation. The company expects to return in March, and it expressed that by then, it would want to see a broader diversity of Thai clients.
Paypal appreciates that the announcement will dissatisfy a large number of clients. As a result, the company deeply apologizes to each of its clients. It further assures customers it is collaborating closely with appropriate agencies in Thailand to accelerate the opening and assure its clients’ continuous use.
What should clients do before March 7, 2022?
Clients’ current balance in Paypal must be used or withdrawn to the bank account linked to their Paypal account.
If the clients are paying for subscriptions using their PayPal account, either through their PayPal wallet balance or a linked debit/credit card, they shoud be prepared to pay this amount in another form before March 7, 2022, or the membership fee will be forfeited.
Can a freelancer/general seller/entrepreneur/owner who already has a PayPal account continue utilizing PayPal to collect payments for active business.
Existing PayPal accounts available to enterprises or owners in Thailand will have their functionality restricted as of March 7, 2022. Except for bank withdrawals, clients will no longer be able to receive or pay using their current account.
If clients want to continue receiving or making payments, only legal businesses registered in Thailand can apply for a new PayPal Thailand business account. They may register their company with Thailand’s Ministry of Commerce. Then, create a new business account with PayPal Thailand.