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Narsi Subramanian of PayPal On The Growth of Indian Freelance Community, Digitisation of FIRC, PayPal’s Upcoming Products & More


PayPal Recently Partnered With Inc42 To Enable Freelancers To Leverage The Global Opportunity

In the recently released India Freelancer Report by the global digital payment giant, PayPal lucidly displayed how India is a power-house of freelancers. In over a decade of its presence in India, PayPal has been innovating payment methods.

PayPal’s surge in its innovative payment methods comes at a crucial juncture in India. This is a time when the government of India is looking forward towards a digitised economy and other campaigns such as Make In India is propelling the country’s growth and its commercial ties with countries far and near. Given the fact that PayPal is operating in over 200 countries, its methods are not only aiding the commercial growth in India but also fuelling its potential.

With over 7.6 Bn payments made in 2017, the company has and continues to offer innovative solutions tailored for this segment – a URL payment option PayPal.me, Invoicing solutions, Seller Protection for intangibles amongst others. In order to offer enhanced convenience, PayPal recently simplified the FIRC application and payment process.

To delve into the potential of the freelance market, Inc42 and PayPal have started a webinar series,‘The Rise in The Freelance Economy’. The first of which was—The Freelance Opportunity In India; Simplifying FIRC .

During the webinar with Inc42, Narsi Subramanian – Director Growth, PayPal India – revealed what PayPal is actually doing for the freelance community in India which is also the second largest in the world and why it is focussed on the freelance community.

And this discussion was crucial for freelancers, entrepreneurs, small merchants and even startups that are selling their products across the world.

Here are some edited excerpts from the discussion:

Narsi Subramanian On Opportunities For PayPal In India

Inc42: According to the report released by Paypal, India is one of the largest freelance markets in the world. What led to this rise?

Narsi Subramanian: We have seen a significant number of freelancers coming in as is also mentioned in the PayPal report. But what has changed is: there is a significant rise in the demand chain globally. Organisations around the world need some way to address these demands.

What happens with freelancers is that when they are out looking for projects, local agencies are used and over a period of time, these platforms provide an opportunity to freelancers to be discovered for work.

So, this is globalisation playing out in a nice way over a period of time. That there is a demand for labour and there is also a way to get the labour is actually playing out.

On the other side, what’s working for India and whats driving for India is that there are a lot of experienced software developers in the country. People quite like what they are doing or they used to do but they also want some flexibility. So, this flexibility and the ability to do what they want to do is also bringing in the element of supply on the other hand.

And that is manifesting in the form of significant growth in the freelance sector. Not only in India but also globally.

Inc42: PayPal is putting up a lot of efforts for the freelance community. So what are some of the opportunities that PayPal is really excited about for this community?

Narsi Subramanian: If you consider a small merchant, they all go through a very similar life journey. Some people don’t want to invest a lot of upfront money but they love what they do so they just want to try out. So, there are a lot of platforms that help them, platforms like Upwork, Freelancer.com, Fiverr, etc. and there are specific platforms which are focussed on specific domains such as designs, art, online tutoring, data analytics, and so on.

These platforms have also grown over a period of time. In the long run, freelancers may continue getting opportunities from those platforms or they may eventually get some good clients of their own. So, freelancers keep evolving in terms of the things they do.

So whether it be some client they work with or some platform they work on, Paypal has payment methods for all. And this is something that PayPal has been doing over a period of time. Globally, if you look at the PayPal transactions, one-fourth of the transactions are cross-border. We offer a two side networking and because of this, we bring in a lot of trust factor. So that works well for the freelancers’ community.

Inc42: How do you ensure the protection of the user data, especially in cross-border transactions?

Narsi Subramanian: PayPal is a company that has been doing transactions for the last 18 years. While we are at it, this is at the core of what we do: safety, security, managing data, etc. We are fully compliant across all geographies in the way we do our business. It’s in our DNA to ensure that we comply with the regulatory standards and data is kept safe.

As simple as, our core value proposition is, if you go to a small merchant for a purchase, you have to enter the card details. But with PayPal, you only have to save the data with us. After that, you will have to share only PayPal credentials and not the card details. So, safety has always been at the core of our work and its always been this way, this is how we had even started. We follow all global best practices in doing this.

Narsi Subramanian On FIRC

Inc42: Over a period of time, PayPal has introduced a host of tools for the community. For instance, the PayPal mobile app. Then it has also digitised the FIRC process. How are these tools going to help the Indian freelance community and how does digitising the FIRC help the freelancers?

Narsi Subramanian: FIRC is Foreign Inward Remittance Certificate. This document acts as a proof of foreign payments to India. It’s very important that exporters especially know of this process. It’s also very important for the freelancers and the small merchants to be compliant to the laws regarding such transactions.

PayPal has further simplified this with its tools. In terms of simplifying FIRC, we cut down the process which earlier involved going to the bank, signing up for a Demand Draft and multitude of other steps. It’s actually a long drawn process.

So, when we heard this, we wanted to simplify this process given that from our end, we focussed on the exports segment. The first thing we did was to work with our bank partner and cut the fees by half, in terms of what they were being charged and we simplified the process further by sharing the details in a mail after which the customer gets the FIRC. Also, the customer was required to make the FIRC fee payment through DD earlier. Now, the fee payment can be made through NEFT. So, now they do not have to go to the bank to request for FIRC.

Inc42: For freelancers who’re getting multiple small payments from outside of India, do they need to file FIRC for each transaction? And if yes, wouldn’t that tremendously increase the cost of filing the FIRC?

Narsi Subramanian: Actually no. There is a way to file a consolidated FIRC. You can actually put in all your transaction IDs in your document. If you go to PayPal.in, there is a section called Useful Info, there you will see a FIRC section, it states a three-step process which you can follow and refer to the FAQ section for details on charges. So, this is a way to consolidate your request so that you won’t have to do it one after the other.

Narsi Subramanian On Challenges Faced By Indian Freelancers

Inc42: Can you also tell us about the challenges that freelancers face, in cross-border transactions in India?

Narsi Subramanian: There are different steps and in each step, they go through different challenges. On a stage one basis, they are looking at ‘how do I find work’. So, they need platforms to help. Someplace where they can list the skill sets and find the value for their work.

But that is also an area where you need to differentiate yourself. This is where one needs to showcase the brand and the skill sets that come with it. It is important to know what is the field that they are playing in. These are the two challenges faced by freelancers. The FIRC is one such area and we are also trying to identify and solve other areas but these are the things we have done so far.

Inc42: How is PayPal helping Indian freelancers fight these challenges?

Narsi Subramanian: Once they have found work, freelancers start engaging through such platforms and also through their direct clients. This calls for a trustable payment mediator. Typically, we have seen that Indian freelancers take an upfront payment and then start their work. The same goes on the other side. They must also have a payment method with which they are also comfortable with.

With PayPal services present in over 200 countries, we provide them with the ease of payment method, either they want to use their cards or they want to use their banks. So, this gives power to the freelancers sitting in Tier II and Tier III cities of India to have access to the consumers across the globe and each transaction happening in four minutes. PayPal money transactions are pretty instant.

PayPal Plans Ahead In India

Inc42: Moving forward, should we expect that PayPal will continue to introduce more tools to ease payments for the freelancers?

Narsi Subramanian: Yes, we will continue to work on this element. So, we see that a freelancer may not necessarily have a website of his own. But as things progress, websites are launched. So, PayPal.me is a payment link that users who don’t have websites can also use and they create a payment link. We are continuously improving that and we are working on features that will allow freelancers to raise invoices through the mobile app as well.

Inc42: Will PayPal solve the issue of currency conversion which is low as per daily conversion rates and also will PayPal decrease its percentage over tax commission per transaction in the near future?  

Narsi Subramanian: When a freelancer works for projects outside of India, PayPal brings in a lot of value in the transactions. So, it doesn’t matter where your client is sitting, whether in Germany or Australia. PayPal’s reach is unmatched. Our rates are in concurrence with that. As far as currency rate is concerned, we look through an average conversion of currency rate. PayPal as a company has a good negotiation power with its partners over conversion rates as opposed to the small merchants.

Inc42: With complex taxation policies like the GST in India, how will PayPal charge freelancers coming from different domains?

Narsi Subramanian: I don’t think its dependent on any of the tax policies. Tax is something we all need to comply with and our charges have remained as is listed on the website. That doesn’t depend on the domain of the freelancers.

Inc42: India’s freelance market is still unorganised. How does PayPal plan to tackle with an unorganised sector?

Narsi Subramanian: The way we see it, India as a country with its infrastructure is getting more and more organised. We are also going big on the digitisation process that’s the financial element of it. Then, there is also the demand-supply element in it over which part is organised and which part is not. Of the 70-80% of the freelancers we spoke with, they said that their work significantly comes from abroad. Where the demand-supply is concerned, there are specific platforms. So, it’s actually quite organised.

Most of these platforms are our partners. We have a list of some of those platforms on our website as well.

Inc42: What are some of the strategies PayPal is considering to stay ahead of the competition in India amidst so many players in the market?

Narsi Subramanian: There are a lot of challenges when it comes to international transactions. PayPal is enabling freelancers to be able to send a link to chat with his client, so the transaction is finished in one touch. So, there is a simplification of that experience. Moreover, we also provide protection, to the freelancers and fight it on their behalf with our schemes in case of frauds. In some of the cases, we foot in the bill as well, as we want to make sure that this trust element is there and it’s real.

Inc42: Will international money transfers via PayPal be as easy as some of the banks and digital wallets like Mobikwik, Paytm and others working in India?

Narsi Subramanian: There are two aspects of international money transfers. One is the remittance (relatives sending money to India, which is called P2P remittance), and the other is remittance for a commercial payment. PayPal actually provides you the capability for commercial payments and this is instant. So, we have clearly set the standard and proven that such seamless international transfers of money work.

Inc42: What is the future of the work for freelancers and how will PayPal impact that?

Narsi Subramanian: The work scope of freelancers is going to evolve into newer spaces. The newer areas we are seeing is designing, online tutoring via Skype, dance classes, yoga classes… name it and people are at it. We are also seeing a lot of students. Because they are in a zone of a lot of innovations happening. So, they want to experience challenges and solve the issues as well. We have seen students being a good part of the freelance economy, as we call it the GIG economy. So, these are some of the areas that we see as budding and it has a good potential for growth.

Inc42: What are the other products that PayPal is launching for the Indian freelancers?

Narsi Subramanian: First of all, we are going to open up domestic payments as well for freelancers very soon. It is expected to happen in the next few weeks. So PayPal.me will work internationally and locally. We have great traction with PayPal.me and we are trying to make more improvements in that and bring in more capabilities in that. We will be bringing in more capabilities in our app, we have an app as well. They can request money from the app. We are working on the invoicing capability.

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