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Thread: Is it illegal to send money via PayPal?

  1. #1
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    Default Is it illegal to send money via PayPal?

    Some one I know personally, used PayPal to send money to a friend in need to Canada some time ago. It cost all parties involved next to nothing and no problems were encountered. Now, looking at the Setcom website, I see that sending money out of SA in this way is "prohibited by the laws of the country". Anyone else using PayPal to send money? In the same regard, is it then illegal to pay for international services using PayPal/credit card. I suppose the main issue is that no Forex is paid and that is why it is illegal?

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    I read an article the other day that stated that sending money to people outside of South Africa without prior approval is illegal except for your own offspring, when you can send up to R30000 if i Remember correctly. However you can legally purchase goods up to R20,000 per annum using your credit card/Paypal without prior approval.

  3. #3
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    What if you send money to your own account abroad?
    Please save trees and think twice before printing this post.

    Looking for a VPN, read my reviews at vpn-reviews.net

  4. #4

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    Quote Originally Posted by ernstn
    I read an article the other day that stated that sending money to people outside of South Africa without prior approval is illegal except for your own offspring, when you can send up to R30000 if i Remember correctly. However you can legally purchase goods up to R20,000 per annum using your credit card/Paypal without prior approval.
    Interesting. One would think that the Reserve Bank would enforce local banks to limit CC transactions then - or at least compel the banks to notify their clients when they spend via Internet?

    I do not spend near this amount, but R1800 or so per month is not by any means an excessive amount. If I add up various purchases, I must run around R100-R200 per month - and this for LOW usage. What about people who are geekaholics? iTunes, iPod, XBOX, Amazon jeez - R20K is not much.
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    Quote Originally Posted by ernstn
    I read an article the other day that stated that sending money to people outside of South Africa without prior approval is illegal except for your own offspring, when you can send up to R30000 if i Remember correctly. However you can legally purchase goods up to R20,000 per annum using your credit card/Paypal without prior approval.
    Can you remember where you read it ernstn? Is the any info on the web?

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    I have read it in the new Nova newspaper. Unfortunately I cannot find anything on-line, their site seems to have disappeared!. But I will check at home to see whether I still have the newspaper and if so I will scan it in tomorrow for you.

    I think the article was published sometime last week!

  7. #7
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    Quote Originally Posted by ernstn
    their site seems to have disappeared!
    No doubt the secret reserve bank police took them out!

  8. #8

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    We have been doing some research into it, because PayPal seems to violate many international money laundering laws. Haven't come to a proper conclusion yet

  9. #9

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    I think the law only applies when you use an authorized financial provider to send money abroad... not payment portals like paypal.

    If setcom states this, and that THEIR payment portal somehow is the one to use instead, it's a marketing scheme. Period.

  10. #10

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    ZA exchange control regulations are ridiculous in the first place - why do I need permission to move MY money to another country!?

  11. #11
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    I ones bought somthing from a site using paypal and it said "ur transaction is completed", the wierd thing is I still didn't recieve the item? it's about 10months later from now and I think they told me it's gonna take like 45day's for deliveries.

    money well waisted...

  12. #12

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    Quote Originally Posted by DearHeart
    Can you remember where you read it ernstn? Is the any info on the web?
    Quote Originally Posted by SA Reserve Bank website - from Exchange Control Manual
    2.1.7 Payments by means of credit and/or debit cards.
    Cardholders in whose name one or more credit and/or debit cards have been issued will be allowed to make permissible foreign currency payments for small transactions e.g. imports over the Internet, by means of such credit and/or debit cards. Permissible transactions are those which may be effected by an Authorised Dealer in terms of the Exchange Control Rulings and clarity must therefore be obtained from an Authorised Dealer. Payments are limited to Rand 20000 per transaction. Cardholders will, however, not be absolved from ad valorem excise and custom duties or from complying with the requirements imposed by the customs authorities.
    You will notice it is 'per transaction' (R20 000). Website www.resbank.co.za

    Gifts
    5.1.1 General requirements
    South African residents may be permitted to transfer monetary gifts within a limit
    of R30 000 per applicant per calendar year to:
    • persons normally resident outside the CMA; and
    • South African residents temporarily outside the CMA for the sole
    purpose of study.
    In lieu of monetary gifts applicants may be permitted to export gift parcels
    containing goods other than gold or gold jewellery, subject to the same limit of
    R30 000. Authorised Dealers may also, in lieu of monetary gifts or gift parcels,
    attest Forms N.E.P. in respect of the export of Krugerrand coins or the equivalent
    in fractional Krugerrand coins up to an amount of R30 000 as gifts by South
    African residents to non-residents.
    Last edited by adsl3g; 31-01-2006 at 06:19 PM.

  13. #13

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    Quote Originally Posted by reech
    ZA exchange control regulations are ridiculous in the first place - why do I need permission to move MY money to another country!?
    It is mearly to protect the country's foreign exchange reserves
    i.e. the country (SA) has a pool of dollars (foreign exchange reserves) - you take your rands and buy the dollars thereby depleting the amount of dollars held in the reserves and those dollars are then externalised to another country (this forces the exchange rate up). If everyone had to buy up all the dollars (foreign reserves) and externalise it, the country would not have anymore dollars to pay for imports, fuel etc etc. When paying for imports, the country gets goods in return - if you just take your money out, the country loses the foreign exchange and gets nothing in return. The same happens for exports - i.e. dollars are received (and placed in the foreign reserves) and rands paid out to the local exporter.
    Where there is no exchange control, the country is in a position to balance its foreign exchange received and paid out hence there are no limitations (like first world countries with large exports etc etc)

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    I heard something on the radio last week that ex-con laws were being changed, correct?

    In reality, you buy something with your card for $100 you get a -R600 on your account and the retailer gets +$100 in their account, but does the bank here really send 100 US$ notes out of the county to deposit in a bank in the USA - I dont believe so, maybe someone can enlighten me
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    Quote Originally Posted by DearHeart
    Some one I know personally, used PayPal to send money to a friend in need to Canada some time ago. It cost all parties involved next to nothing and no problems were encountered. Now, looking at the Setcom website, I see that sending money out of SA in this way is "prohibited by the laws of the country". Anyone else using PayPal to send money? In the same regard, is it then illegal to pay for international services using PayPal/credit card. I suppose the main issue is that no Forex is paid and that is why it is illegal?
    yes it is illegal... but who cares? fark 'em and their law!

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