What is the Purpose Code?
In accordance with Indian regulations, you’re required to add a reason for your payments (also known as a "purpose code"). This helps the regulators to understand the exact nature of your cross-border transactions. This purpose code must be in place before you can withdraw funds from your PayPal account to your local Indian bank account. You only need to add the purpose code once, and it’ll be used as the default reason for all your payments.
For all Business accounts, the purpose code is collected during the account creation.