Can a US Company Accept UPI? What US Businesses Need to Know

Short answer: yes. Not by flipping a switch in the payment setup you already have, but yes.

If you are a US company with real demand from India, you have probably seen the pattern. Plenty of Indian customers do not want to pay with a card. They want UPI, the bank-to-bank payment system used through apps such as Google Pay, PhonePe, and Paytm that now handles most digital payment transactions in the country.

By transaction volume, UPI made up about 85.5% of India’s digital payments in the second half of 2025, according to the RBI’s Payment Systems Report. That makes UPI hard to ignore if you want to sell to Indian customers.

When UPI is not on your checkout, those customers do not necessarily reach for a Visa. They leave.

So can a foreign company actually accept it? Here is the honest, useful version.

Why you can’t just “add UPI” like Apple Pay

UPI is a domestic Indian payment rail. It is operated by the National Payments Corporation of India (NPCI) and connects customers’ bank accounts through participating banks and payment apps.

That infrastructure is built around payments in India and settlement in Indian rupees. It is not designed to simply send a UPI payment straight into a US bank account. That is why your existing global payment setup does not automatically offer UPI to Indian buyers.

The issue is not that UPI cannot be used by a foreign business. The issue is how the payment is collected, processed, converted and settled across borders.

For years, the workaround was painful. Set up an Indian subsidiary, open a local bank account, complete the required registrations, and build an India-specific payment setup. For a company that is still testing Indian demand, that is often a non-starter.

That is the part that changed.

The route that works: A licensed cross-border aggregator

In October 2023, the RBI introduced a regulatory framework for Payment Aggregator-Cross Border, or PA-CB, services. The framework brought entities facilitating cross-border payments for the import and export of goods and services under direct RBI regulation.

For a foreign business, the important part is simple: a licensed PA-CB provider can facilitate eligible payments from Indian customers and settle the proceeds to the overseas business, subject to the applicable RBI, FEMA, KYC and other regulatory requirements.

No Indian entity required. No Indian bank account required. No India-specific payment infrastructure for the merchant to build just to collect payments.

Here is the flow

Your Indian customer selects UPI at checkout and pays in rupees through their preferred UPI app. The PA-CB provider processes the payment and handles the relevant India-side payment and compliance requirements.

Intelligent routing pushes success rates above 80% on the payment methods Indians actually use. The funds are converted to your settlement currency and sent to your overseas account by SWIFT, on a T+2* business-day basis.

You receive the money in the currency you bank in, while settlement, refund and transaction information can be managed through the provider’s dashboard and APIs.

The important distinction is that the payment provider handles the payment-side infrastructure; it does not automatically eliminate every tax or regulatory obligation your business may have in India.

What US businesses specifically need to know

A few things trip up American companies in particular.

1. You still have to pick a licensed provider

PA-CB authorisation is a regulated activity, so do not assume that a familiar global payment processor can automatically provide India cross-border acceptance. Check the provider’s current RBI authorisation and the categories it is approved for before you sign.

Cashfree Payments was the first non-bank entity to receive RBI approval for both Export and Import PA-CB on July 22, 2024. The RBI’s authorised-entity list confirms Cashfree’s PA-CB-E&I approval.

2. There is a per-transaction ceiling

The RBI’s PA-CB framework sets a maximum value of ₹25,00,000 per unit of goods or services sold or purchased. That is roughly US$28,000–30,000 depending on the exchange rate. For SaaS, digital products, courses and most consumer purchases, you may never feel the limit. For high-ticket B2B transactions, it is something to plan around.

If you are quoting the limit to customers or building your payment flows around it, confirm the current regulatory position before relying on the figure.

3. UPI recurring payments have their own rules

If you bill subscriptions through UPI AutoPay, recurring transactions are subject to India’s e-mandate framework. For subsequent recurring transactions, the limit without additional authentication is generally ₹15,000 per transaction. RBI increased this to ₹1 lakh per transaction for specified categories, including mutual fund subscriptions, insurance premiums and credit-card bill payments.

The framework also requires a pre-debit notification to be sent to the customer at least 24 hours before the actual debit.

For most consumer subscriptions, these limits will not be a problem. But if your pricing is higher, or your business relies heavily on recurring UPI payments, build the payment flow around the applicable mandate requirements from the beginning.

4. Collecting payments does not settle your tax position

This is an important distinction.

A PA-CB lets you collect eligible payments from Indian customers without necessarily incorporating in India. It does not automatically determine whether your business owes Indian GST, income tax or other taxes.

That depends on what you sell, where your business operates, the type of customer you serve and how the transaction is structured.

Get professional tax advice if you have meaningful Indian revenue. Alternatively, some digital businesses use a Merchant of Record (MoR), where a third party becomes the seller of record and takes on broader tax and compliance responsibilities.

A Merchant of Record can be more comprehensive, but it is usually a heavier and more expensive model.

PA-CB vs Merchant of Record: Which should you use?

The choice comes down to how much of the India operation you want to own.

	PA-CB Gateway	Merchant of Record
Merchant of record	You remain the merchant	MoR becomes the seller of record
Indian payment methods	Yes, through the provider	Yes, depending on provider
Indian entity	Not necessarily required	Not necessarily required
Payment processing	Provider handles it	Provider handles it
Tax responsibilities	You generally retain your own tax position	MoR can take on broader tax obligations
Customer relationship	You retain more control	More responsibilities may sit with the MoR
Best for	Businesses wanting payment infrastructure without incorporating in India	Businesses wanting to outsource more tax/compliance work

If you mainly want to stop losing Indian customers at checkout and are comfortable handling your own tax position, a licensed PA-CB gateway is generally the more direct route.

If you sell digital products at scale and would rather outsource more of the Indian tax and compliance burden, a Merchant of Record may make more sense.

How Cashfree helps US businesses accept UPI

This is where the infrastructure matters.

Cashfree Payments gives international businesses access to India’s local payment methods through its PA-CB infrastructure, including UPI and other payment options Indian customers expect.

Instead of building an Indian entity, local bank relationship and India-specific payment stack just to test demand, an eligible international business can use Cashfree to collect payments from Indian customers and settle the proceeds to its overseas account.

Cashfree’s PA-CB Export and Import authorisation covers both sides of the cross-border flow, while its payment infrastructure supports local Indian payment methods alongside international payment acceptance.

For businesses that want to accept UPI without building their own India payment infrastructure, that distinction matters.

The goal isn’t simply to add a UPI button.

It is to make the entire flow work: Indian customer → local payment method → regulated cross-border processing → FX conversion → overseas settlement.

Also read: How to Receive International Business Payments in India?

So, can a US company accept UPI?

Yes.

A US company does not necessarily need to incorporate in India just to accept UPI from Indian customers. The key is using a properly authorised cross-border payment provider that can handle the India-side payment infrastructure and the applicable regulatory requirements.

For businesses testing India, selling SaaS, running online courses, selling digital products or serving Indian consumers from overseas, that can remove a major barrier to entering the market.

The headline is the part worth repeating:

A US company can now accept UPI from Indian customers without opening a company or bank account in India.

The wall that used to make many businesses give up is much lower now. What is left is choosing a licensed partner and building a checkout that speaks the way your Indian customers actually pay.