The World Cup runner-up has been heavily touted as a summer signing for PSG, but claims that after a few days of reflection that he has no intention to leave Barcelona.
Rakitic admits he discussed the possibility of a transfer with his wife and family, as well as his agent, before coming to the decision that he will remain with the 2017-18 La Liga champions.
The 30 year old has started Barca's two league games this season and believes he can continue to be a key part of the Blaugrana team as they continue to challenge for trophies.
"The last days were for reflecting and for me is a privilege wearing the shirt, I am very proud and I hope to be here for a long time," Rakitic told reporters in the mixed zone after the 1-0 win over Real Valladolid.
"Playing in the best club in the world is the biggest thing, I have spoken to my wife, my family and my agent and we all decided we are very well here and there's no other club able to offer me what Barcelona is offering. Right now the most important thing is to prepare for the next games in the best possible way."
Amid the transfer rumours, Barcelona head coach Ernesto Valverde insisted that Rakitic should not be allowed leave, claiming that he is 'a fundamental player to the club.'
Rakitic was pleased with his manager's praise, admitting that he was grateful to the club and fans for the loyalty they had shown him recently and during his time at Barcelona.
"Thanks for the coach's words, to the board, the team and the fans, I feel privileged and I will give my all to win titles," he continued.
"There were many clubs asking for me but we thought about it with my family and it was a very easy decision, I wanted to be here."