For all those half a million small time programmers / bloggers / freelance writers / online service providers in India, Paypal is the primary source for receiving the payments from overseas clients. And over 70% of the individual account holders from India have the non-revenue earning Personal Type accounts.
Now Paypal has suddenly stopped payment into all the Indian account holders from January 28th, without even specifying the exact reason behind the action. The worst part is that there are no contact numbers or contact persons who can provide real guidance on the issue.
All that Paypal is saying is that they are working hard to resolve the issue quickly. The primary reason could be some data requirements by the Indian tax authorities which Paypal might have not been able to provide immediately. Also the situation might well be used by Paypal to force most of the users to revenue generation customer Type, like Business Type or Premier Type.
Paypal has also reversed quite a few payment credits received since January 28th to the original senders without even informing the account holders. While people might end up losing 5% to 7% of their future credits if they change from Personal Type account, it may still be worth it.