How Foreign Companies Can Accept Payments in India (2026 Guide)

Table of Contents

Key Takeaways

Foreign companies can accept payments from Indian customers without incorporating a local Indian entity.
UPI has become the preferred payment method for Indian consumers and should be a core part of any checkout experience.
RBI’s PA-CB framework regulates cross-border online payment aggregation in India.
Settlement speed, compliance support, and FX transparency are often more important than transaction fees.
Choosing a PA-CB-authorized payment provider helps simplify onboarding, remittance workflows, and regulatory compliance.

India is no longer just an emerging market. It is one of the world’s largest digital commerce ecosystems, powered by real-time payments, mobile-first consumers, and a highly regulated financial infrastructure.

For global businesses expanding into India, accepting payments is often the first operational challenge. A payment setup that works seamlessly in the US, UK, or Europe may fail to meet Indian customer expectations, regulatory requirements, or local payment preferences.

The biggest reason is UPI (Unified Payments Interface), India’s real-time bank-to-bank payment network, which has fundamentally changed how consumers pay online. Today, UPI accounts for the majority of digital retail transactions in India, it processed more than ₹230 lakh crore ($2.56 trillion) in transactions between April and December 2025. Making it a critical payment method for any business targeting Indian customers.

At the same time, cross-border payment collections are governed by the Reserve Bank of India’s (RBI) Payment Aggregator – Cross Border (PA-CB) framework. Businesses entering India must ensure their payment provider supports both local payment methods and the compliance infrastructure required for international settlements.

This guide explains how foreign companies can legally collect payments from Indian customers, what regulations apply, and how to choose the best payment gateway for entering the India market in 2026.

Why India Is Different From Other Payment Markets

Many global businesses assume that accepting Visa, Mastercard, or PayPal is enough to serve Indian customers.

In reality, India’s payment ecosystem operates differently from most Western markets.

UPI Dominates Consumer Payments

Indian consumers increasingly prefer direct bank-to-bank payments through UPI instead of entering card details during checkout. Businesses that offer only card payments often experience higher checkout abandonment compared to merchants offering UPI alongside cards and wallets.

Mobile-First Consumer Behavior

India has one of the world’s largest smartphone user bases. Consumers expect payments to be completed in seconds with minimal friction.

Regulatory Oversight Is Stronger

Cross-border payment flows involving Indian consumers are governed by RBI regulations. Businesses must ensure their payment infrastructure complies with applicable onboarding, settlement, and reporting requirements.

Localized Checkout Matters

Indian consumers expect prices in INR, familiar payment methods, and seamless payment experiences. A localized checkout can significantly improve conversion rates compared to a generic international payment flow.

Why Global Payment Gateways Often Struggle in India

Many global payment gateways were originally built for card-first markets. However, India’s digital payments ecosystem is heavily driven by UPI, localized checkout experiences, and RBI-regulated payment flows. Businesses that rely solely on traditional international payment infrastructure often experience lower conversion rates, settlement complexities, and compliance challenges when serving Indian customers.

India’s payment stack is structurally different from Western markets. In a country where UPI accounts for more than 75% of digital retail transaction volume, it has become the default payment behaviour.

For a SaaS company billing 10,000 Indian subscribers through a card-only checkout, this means instantly losing access to a significant portion of potential customers.

These businesses often experience higher abandonment rates because Indian consumers increasingly expect instant bank-based payments.

As per RBI’s October 31, 2023 Framework, the PA-CB authorisation is necessary for non-bank entities aggregating INR payments from Indian customers and sending them to foreign entities.

In India, many global payment gateways still lack RBI-compliant onboarding, India-specific settlement workflows, and integrated compliance infrastructure for cross-border payment operations where applicable.

What Regulations Apply for Cross-Border Payment Gateway India?

A Payment Aggregator – Cross Border (PA-CB) is a non-bank entity with Reserve Bank of India (RBI) authorisation and is allowed to aggregate and process cross-border online payment transactions.

This framework has created a regulated entry point for international businesses and payment aggregators in India to work together to handle INR collections from Indian customers.

The PA-CB framework has three layers:

License Type	Full Name	What It Covers
PA-CB-E	Payment Aggregator – Cross-Border Export	Indian businesses receiving inward payments from foreign customers
PA-CB-I	Payment Aggregator – Cross-Border Import	Foreign merchants collecting INR from Indian consumers
PA-CB-E&I	Payment Aggregator – Cross-Border Export & Import	Full cross-border payment aggregation in both directions

A growing number of payment providers in India now hold PA-CB authorisation, and Cashfree was the first entity to receive the PA-CB-E&I licence in July 2024.

Key Facts About India PA-CB Framework
RBI issued the PA-CB framework on October 31, 2023
PA-CB regulates cross-border INR collections and export/import payment aggregation
Cashfree Payments was the first PA-CB-E&I licensee in July 2024
Foreign companies can operate in India without their own licence by partnering with a licensed PA-CB entity

What Happens If You Use a Non-Compliant Payment Setup?

Choosing the wrong payment infrastructure can create operational and regulatory challenges for international businesses.

Common issues include:

Inability to accept UPI payments from Indian customers
Higher checkout abandonment rates due to limited payment methods
Delays in settlement and remittance processing
Additional compliance and documentation requirements
Difficulty scaling payment operations as transaction volumes increase

Working with an RBI-authorized PA-CB provider helps businesses avoid these challenges while ensuring a smoother customer payment experience.

What Foreign Companies Need in an International Payment Aggregator India?

The best payment gateway for entering the India market does not rest on brand familiarity only. You also need a proper infrastructure to lay the foundation of your business in India, and instead of building it yourself, you can get it from a reputed payment provider.

PA-CB License: PA-CB authorisation is non-negotiable for payment gateway India for foreign companies use cases. Verify that the provider is authorised for the flow you need – PA-CB-I for foreign merchants collecting INR from Indian consumers, or PA-CB-E&I if you need both import and export flows.

UPI Support for International Merchants: As UPI dominates the Indian customer’s payment behaviour, your cross border payment aggregator India 2026 needs to have UPI support. Global payment gateways with UPI support see reduced abandonment rate to card-only payment flows, and card-only recurring flows may see lower conversion among Indian customers who prefer UPI-based payments.

No Local Entity Required: For foreign companies partnering with a PA-CB licensed payment provider, no local entity registration is required.

Settlement and FX Transparency: When choosing your provider, review settlement currency options, foreign exchange markup structures, and payout timelines.

Settlement and Compliance Documentation: Cross-border payment flows may require settlement, remittance, and compliance documentation depending on the transaction structure and applicable reporting obligations. Your payment provider should support the workflows and information required by authorised dealer banks and RBI-regulated processes where applicable.
Multi-Currency Checkout: Indian customers expect an INR-denominated checkout experience even if the payments they make are settled in USD, Euro, etc. The conversion part is handled by the payment provider.

Developer Integration Quality: If you have remote teams working on the business, they need REST APIs, SDKs and plugins for Shopify, WooCommerce, and Magento with minimal integration overhead. They need streamlined operations and not complex infrastructure to run the business.

India-Specific Risk Infrastructure: To prevent fraud, all payment structures must support tokenisation, 3DS 2.0 authentication, transaction monitoring, and UPI-specific risk controls.
Settlement Speed: T+1 to T+2 settlement speed is the operational benchmark, and every payment provider giving cross-border merchant collections needs to ensure the payments are completed as quickly as possible.

Which Businesses Benefit Most from a Cross-Border Payment Gateway in India?

Different business models have different payment requirements.

SaaS Companies

SaaS businesses need recurring billing, subscription management, and support for local payment preferences such as UPI.

eCommerce Brands

Online retailers require high checkout conversion rates, multi-payment support, and efficient settlement infrastructure.

EdTech Companies

Education businesses often process international enrollments and benefit from localized payment experiences for Indian students.

Digital Services and Agencies

Consultancies, agencies, and freelancers need efficient cross-border collections with streamlined settlement and documentation workflows.

How a Foreign Company Can Start Accepting Indian Payments?

For a business owner sitting in the USA, accepting payments from Indian customers shouldn’t be hard. But the way the Indian payments infrastructure is built, it poses some challenges for the business owners to come and set up shop in India.

But let’s make it easy for you. Follow this process to set up your cross-border payment gateway, India specific.

Determine the Business Use Case

The payment setup changes with the type or nature of your business. For instance, an eCommerce brand will need an international payment gateway, but SaaS businesses will need a gateway with subscription billing. Similarly, B2B exports collecting service payments will need Global Collection Accounts.

So you need to first understand and identify the use case, that is, what sort of payment structure do you need?

Create an Account with your Payment Provider

Create an account with your payment provider and register your merchant profile. A local Indian entity is not required to accept international payments for onboarding. This removes one of the largest barriers for foreign companies trying to set up their business in India.

Submit RBI-Compliant KYC Documentation

The standard merchant onboarding documentation includes;

Certificate of incorporation
Tax registration details
Authorised signatory evidence
Settlement bank account information
Website or App URL

Enable India Payment Methods

Optimize your payment infrastructure by activating the required payment methods, including Visa, MasterCard, Amex, Net banking, and most importantly, UPI for Indian consumers. You can also connect PayPal and configure it for dynamic currency conversion for an INR-denominated checkout experience.

Integrate your Business Front

For eCommerce brands, international payment aggregators in India provide REST APIs, sandbox testing environments, and integrations for Shopify, WooCommerce, Wix, WordPress, and Magento.

Also, ask for developer resources and API documentation; your technical team will need them for the entire setup.

Settlement Configuration

Payment settlements are the most important part of the entire process, as this decides how soon you can receive payments in your USA bank account.

Ensure Indian customers can pay in INR, while your provider manages FX conversion and settlement into your supported overseas currency.

When setting up the settlement process, you should define settlement cycles and reporting workflows that support the required remittance and compliance documentation, wherever applicable under FEMA and banking regulations.

Why is Cashfree the Best Payment Gateway for Entering the India Market?

Cashfree is the first non-bank entity to receive a PA-CB-E&I certificate from the Reserve Bank of India to process inward and outward cross-border payment flows. Annually, we are processing around $80B+ in payments and supporting businesses spread over 180 countries that are easily doing business in India and selling their products or services here.

Our payment stack includes;

UPI
Cards
PayPal
Wallets
EMI
BNPL

This makes Cashfree a global payment gateway with UPI support, even for international businesses.

The product suite we offer is specifically designed for payment gateway for India for foreign companies’ use cases.

International Payment Gateway supports 3DS 2.0 cards and Dynamic Currency Conversion.
FlowWise intelligently routes transactions across aggregators to improve success rates.
RiskShield provides AI-driven fraud prevention that can reduce fraudulent activity by up to 40%.
Global Collections Accounts support USD, EUR, GBP, CAD, and CHF collections with integrated settlement, remittance, and compliance documentation workflows aligned with RBI and FEMA requirements, wherever applicable.

Conclusion

Entering India requires more than simply enabling international card payments. Businesses need payment infrastructure that aligns with local customer preferences, regulatory requirements, and cross-border settlement processes.

As UPI continues to dominate digital payments and RBI regulations shape how international collections operate, choosing the right payment partner becomes a strategic business decision rather than a technical implementation choice.

The best payment gateway for entering the India market should combine regulatory compliance, localized payment acceptance, transparent settlements, and scalable infrastructure that supports long-term growth.

Among all payment gateway India for foreign companies, Cashfree stands out by combining RBI-authorized cross-border infrastructure, UPI-native payments, multi-currency settlements, and integrated compliance workflows in a single platform.

FAQs

Do Foreign Companies Need an Indian Bank Account to Accept Payments?

No. Many RBI-authorized PA-CB payment providers allow foreign businesses to collect payments from Indian customers and receive settlements in supported international bank accounts.

How Long Does It Take to Start Accepting Payments from India?

The onboarding timeline depends on the payment provider and merchant verification requirements. Businesses typically need to complete KYC verification, submit business documentation, and configure settlement preferences before going live.

Can a foreign company accept UPI payments without an Indian entity?

Any foreign company operating from their country can accept UPI payments provided they have the right payment provider as their partner. Not all payment gateways accept UPI payments, so you need to choose PA-CB licensed operators. Without this model, foreign entities need to incorporate their company in India to receive payments.

Is UPI Necessary for International Businesses Selling in India?

While businesses can technically accept card payments only, UPI has become the preferred payment method for many Indian consumers. Supporting UPI can improve checkout convenience and reduce payment friction.

Can Foreign SaaS Companies Accept Subscription Payments from India?

Yes. International SaaS companies can accept payments from Indian customers through payment providers that support recurring billing and compliant cross-border payment collection workflows.

What is the PA-CB licence and why does it matter?

A PA-CB license is an authorisation given by the Reserve Bank of India (RBI) to non-bank entities. This allows non-banking entities to aggregate and process cross-border online payments for import and export of goods and services.

What payment methods do Indian customers prefer when purchasing goods or services?

Indian consumers predominantly use UPI as the preferred payment method. UPI accounts for 75% of all digital transactions made in India, and other common methods include RuPay cards, net banking, Visa/Mastercard credit or debit cards, and digital wallets.

What is the difference between a payment gateway and a cross-border payment aggregator in India?

A payment gateway provides the technology infrastructure to authorise and process online payment transactions. A cross-border payment aggregator (PA-CB) is a regulated entity authorised by RBI to aggregate and process eligible cross-border online payment transactions involving Indian consumers and international businesses.