On October 31, 2023, the Reserve Bank of India (RBI) issued a master circular on the import of goods and services titled <a href="https://m.rbi.org.in//Scripts/NotificationUser.aspx?Id=12561&amp;Mode=0">Regulation of Payment Aggregator – Cross Border</a>.&nbsp;&nbsp;

According to the circular, the RBI will regulate all Indian entities facilitating online cross-border payments for the import and export of permissible goods and services. Moreover, these entities will be collectively termed Payment Aggregators Cross Border (PA-CB).

The circular comprises guidelines to streamline the existing cross-border payment framework in India. Previously, cross-border transactions were carried out through Online Payment Gateway Service Providers (<a href="https://www.skydo.com/blog/online-payment-gateway-service-provider-opgsp?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">OPGSPs</a>) as per a circular issued by RBI in 2015.

OPGSPs operate by partnering with an Authorised Dealer (Category I) Bank (AD Bank) and notifying the RBI. According to RBI guidelines, no formal license is needed to function as an OPGSP.

Hence, RBI has issued a circular to establish a concise and clear framework for cross-border payments. RBI will now oversee all cross-border payments in India related to the import and export of goods. The circular applies to PA-CB, PAs, authorised banks and OPGSPs.&nbsp;The PA-CB circular also denotes that there can’t be any new OPGSP.

This blog discusses the key provisions related to the latest RBI circular on the import of goods and services, RBI guidelines for payment gateway, and OPGSP guidelines.

Master Circular on Import of Goods and Services: RBI Bank Guidelines

The following are the key guidelines mentioned in the circular.

The following entities need to adhere to RBI guidelines/instructions provided in the circular.

Here are the key developments included in the new PACB circular.

Categories of Authorisation as per PA-CB Activity&nbsp;

Based on the cross-border payment activity undertaken by the PA-CBs, they can seek authorisation for one of the following three categories.

PA-CB, facilitating cross-border payments for Indian exporters, has to open an Export Collection Account (ECA) with an AD bank.&nbsp;

ECAs can be opened in either Indian currency or foreign currency. In the case of the latter, various ECAs have to be opened for different currencies.

The PA-CBs will credit all export proceeds in the respective ECAs. Additionally, export PA-CBs need to follow the below guidelines:

Similar to export PA-CBs, import PA-CBs have to open an Import Collection Account (ICA) with an AD bank.&nbsp;

They will collect the payment from importers in an escrow account managed by the payment aggregator. It will then be transferred to ICA and will eventually be transferred to the bank account of the foreign merchants.

These entities are allowed to directly onboard foreign merchants, e-commerce marketplaces, or other overseas entities that offer payment aggregation services.&nbsp;

Here are the guidelines Import PA-CBs need to follow.

Those PA-CB who engage in both import and export activities have to comply with the requirements for both Import PA-CB and Export PA-CB.

They also need to ensure that the maximum value per unit of exported or imported goods or services should be ₹25,00,000.

Non-banks who want to provide PA-CB services will have to seek authorisation from RBI. However, before seeking RBI authorisation, it is necessary to register with the Financial Intelligence Unit-India (FIU-IND).&nbsp;

However, RBI has issued the following net-worth criteria for non-banks providing PA-CB services.

The accounts of existing non-bank PA-CB who are unable to meet the net worth requirement will be closed by banks by 31 July 2024.

Snapshot Comparison Between OPGSP Circular (2015) and PA-CB Circular (2023)&nbsp;

Here are the key differences between the OPGSP Circular (2015) and the PA-CB Circular (2023)

Here is the process of seeking approval from RBI for existing or new PA-CBs.

Step 1: Draft the application through Form A, which includes the following parts.

Step 3: The RBI will process the application.

(RBI may raise queries related to various aspects such as shareholding, product processes, etc.)&nbsp;

Step 4: In principle approval from RBI.

Step 5: Filing of system Audit Report

(RBI may raise queries related to SAR audit observations)&nbsp;

Step 6: Final authorisation(state additional conditions that must be complied with)&nbsp;

The evolving cross-border payments environment and the emergence of several OPGSPs and other fintech entities encouraged RBI to issue the circular. Its main purpose is to ensure seamless and more transparent cross-border payment transactions.

Even though regulatory authorities are constantly working on making cross-border payment transactions seamless, transparent, secure, and quicker, businesses often face difficulties in receiving timely payments.&nbsp;

Skydo aims to simplify the cross-border payment landscape for businesses by automating various tasks and helping businesses open foreign bank accounts. <a href="https://www.skydo.com/?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=demo_click">Join Skydo today</a> to streamline your invoicing and financial management activities!

Q1. RBI’s master circular on the import of goods and services and cross-border payments applies to which entities?

Ans. AD banks, PAs, and PA-CBs involved in the online processing/settlement of cross-border payment transactions related to the import and export of goods and services have to comply with the guidelines mentioned in the circular.

Q2. What are various compliances according to RBI payment aggregator guidelines for cross-border payments?

Ans. All PA-CBs have to follow the guidelines provided in the circular dated October 31, 2023. Additionally, they also have to follow the various guidelines for payment aggregators mentioned under a circular issued by RBI on March 17, 2020.&nbsp;The circular includes guidelines related to customer grievance redressal and compliance with Baseline Technology Guidelines to ensure fraud prevention and risk management.

Q3. How can PA-CB seek authorisation for facilitating cross-border payment transactions?

Ans. AD banks do not need to seek authorisation to facilitate cross-border payment transactions. However, a non-bank PA-CB can seek authorisation from RBI by sending the application to the Department of Payment and Settlement Systems (DPSS), RBI, Central Office (CO), by April 30, 2024. PA-CB entities must fulfil the minimum net worth criteria before applying to RBI.

 Know more about RBI's circular that mandates payment aggregators to seek authorization for facilitating cross-border transactions by April 30, 2024.

BI’s PACB Circular: Key OPGSP Updates of 2024 to Note 

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Professional Tax is governed and levied by the respective state governments' professional tax acts. The amount you owe in taxes varies based on factors such as income, the nature of the profession, and the state in which the individual operates.

Here is everything you need to know about PT as a <a href="https://skydo.com/blog/freelancer-earning-potential-in-2024?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelancer</a>.

If a person is salaried, the employers are responsible for deducting the professional tax amount directly from the salary. However, the government requires professionals such as <a href="https://www.skydo.com/blog/top-5-new-age-freelance-services-going-to-take-off-in-2024?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelancers</a> to pay the P tax directly to their state government.Professional tax meaning is not based on income but rather on the nature of the profession or employment. It is meant to contribute to the state's revenue and development. The professional tax differs from other types of taxes mentioned below.&nbsp;

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Here is the basic structure of professional tax in India.

Calculate your Professional Tax Liability

<a href="https://vakilsearch.com/professional-tax-registration/how-professional-tax-calculated">Professional tax liability</a> depends on a <a href="https://www.skydo.com/blog/startup-guide-for-freelancers-with-practical-tools?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelancer's</a> state of operations and earnings. However, irrespective of these two factors, the professional tax limit is Rs 2,500 for a month.

Here is the process of how to calculate professional tax on salary or earnings.

To minimise your professional tax burden as a <a href="https://www.skydo.com/blog/top-10-freelancing-truths?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelancer,</a> leverage deductions and exemptions available in your location. Here are some deductions and exemptions that freelancers can utilise:&nbsp;

You can use various accounting software or apps, such as <a href="https://khatabook.com/?utm_source=google&amp;utm_medium=search_ads&amp;utm_campaign=brand-gen_kw&amp;gad_source=1&amp;gclid=CjwKCAiA8sauBhB3EiwAruTRJhfwyGzRw85xwgamLcwna0oixY1MjScYAHjtZdAMqNRewwPZ1LRiqxoCVp8QAvD_BwE">Khatabook</a>, <a href="https://open.money/automated-accounting?utm_term=accounting%20automation&amp;utm_campaign=IYD_AP_Automation&amp;utm_source=google&amp;utm_medium=ppc&amp;hsa_acc=9660999868&amp;hsa_cam=20910601824&amp;hsa_grp=163502573492&amp;hsa_ad=689290766627&amp;hsa_src=g&amp;hsa_tgt=kwd-300068243667&amp;hsa_kw=accounting%20automation&amp;hsa_mt=p&amp;hsa_net=adwords&amp;hsa_ver=3&amp;gad_source=1&amp;gclid=CjwKCAiA8sauBhB3EiwAruTRJoBtiurqa_a2MAgb-mcQBj-Ab196-Oe822q4DWHxHHuVZ4XjCLSZORoC_0cQAvD_BwE">Open Money</a>, <a href="https://tallysolutions.com/download/#gref">TallyPrime</a>, etc., to keep track of your expenses. Furthermore, it is wise to regularly reconcile your financial records to ensure accuracy and identify potential deductible expenses.

Certain <a href="https://www.skydo.com/blog/how-to-get-new-clients-as-a-freelancer?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelance professions</a> or industries may be subject to specific taxes or regulations beyond professional tax and income tax. For example, online content creators, such as bloggers, YouTubers, and influencers, may need to comply with digital services taxes or regulations specific to online advertising revenue.

Hence, consulting a tax advisor or <a href="https://www.skydo.com/blog/top-online-communities-you-should-join-as-a-freelancer-in-2024?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">researching extensively</a> is important to know your compliance and taxation liabilities. You may also <a href="https://www.skydo.com/blog/how-to-file-gst-monthly-and-quarterly-for-freelancers?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">have to register for GST</a> if your annual income from freelancing is above Rs 20 lakh.

Proactively managing your professional tax obligations <a href="https://www.skydo.com/blog/importance-of-fira-for-freelancers?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">as a freelancer</a> can minimise tax burdens and avoid potential penalties or legal issues. Moreover, seeking professional advice from tax consultants or accountants can provide invaluable guidance tailored to your specific circumstances.

For further resources on freelancing, you can read <a href="https://www.skydo.com/?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=demo_click">Skydo’s</a> <a href="https://www.skydo.com/blog?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">blogs</a> and open a free virtual currency account if you receive<a href="https://www.skydo.com/blog/how-do-you-receive-a-foreign-remittance-in-a-savings-account?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link"> foreign remittances.&nbsp;</a>

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<a href="https://www.skydo.com/blog/set-up-your-freelance-international-bank-account-in-just-5-minutes?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">Banking operations</a> previously required visiting branches. Today, they are being heavily digitised, as users want to have access to banking services instantly through their mobile phones or laptops.

A new player has emerged on the financial scene – the Neobank. With their <a href="https://www.skydo.com/blog/the-impact-of-open-banking?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">innovative approach to banking</a> and emphasis on digital-first solutions, neobanks are revolutionising the banking sector.

Neobank meaning or neo banking meaning refers to fintech (financial companies backed by tech) that carry out operations similar to banks but are entirely digital and rarely have physical branches.&nbsp;

Neobanks invest heavily in creating a digital-first banking system to provide <a href="https://www.skydo.com/blog/checklist-to-get-the-right-bank-for-your-export-service-firm?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">cutting-edge financial services</a> similar to any other traditional bank.&nbsp;

Neobanks are not directly governed and regulated by the RBI but have various banking partners such as HDFC, ICICI, and Axis Bank to assist them in providing financial services through their banking infrastructure and channels.&nbsp;

Neobanks offer banking services such as savings accounts, checking accounts, payment processing, money transfers, and sometimes lending services entirely online.&nbsp;

Neobanks leverage technology extensively to provide a seamless and convenient banking experience. They often incorporate advanced features such as instant money transfers, automated budgeting tools, personalised financial insights, and round-the-clock customer support through chatbots or online messaging.

Here is how you can open a Neobank account online.

There are more <a href="https://www.startuphrtoolkit.com/neobanks-in-india/">than 20 neobanks in India</a>. Thus, comparing them on their cost structure and services is important.&nbsp;

Download the mobile app of the neobank or visit their website to start the account registration process. You will have to provide personal details such as name, date of birth, address, email, phone number, and identification proofs such as PAN or Aadhar. Then, choose the type of account you want to open.&nbsp;

Once you have submitted the account opening application, the neobank verifies the provided information. After successful verification, they set up the account.&nbsp;

Step 4: Confirmation and Activation&nbsp;

Once all steps are completed, you will receive confirmation that your account has been successfully opened. You may need to activate your account by following the instructions provided by the neobank, such as verifying your email or phone number.

Some common features offered by the best neobanks in India include the following.

For a better understanding of neo-banking meaning, here are the pros and cons of neobanks.

India has numerous neobanks that offer their services with unique banking features. Here are the top <a href="https://www.startuphrtoolkit.com/neobanks-in-india/">10 popular neobanks examples in India</a>.

Neo banking services offer a compelling alternative to traditional banking, with a host of potential benefits and considerations for users to weigh. On one hand, the convenience, accessibility, and transparency of neobanks make <a href="https://www.skydo.com/blog/get-real-time-insights-for-analyzing-freelance-financial-goals?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">managing finances </a>easier and more efficient than ever before.

However, it's essential for users to also consider the limitations of neobanks, such as the lack of physical branches, the relative newness of some players, and concerns about data privacy. By weighing these factors carefully and understanding their individual banking needs and preferences, users can decide whether neobanks are the right fit for them.

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Whether you’re cold-emailing or responding to a job posting, your email pitch can make or break your chances of landing freelance work.

But writing professional and persuasive mail to clients may have you second-guess how to introduce yourself, showcase your value, and ask for what you want without sounding desperate or pushy.

This guide on how to write an email to a client requesting for project will help you impress any client, potential or existing, and get you more freelance work.&nbsp;&nbsp;

How to write an email to clients - Before You Hit Send

Before you start pitching to offer your <a href="https://www.skydo.com/blog/top-5-new-age-freelance-services-going-to-take-off-in-2024?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">freelance services</a>, you need to do some preparation.&nbsp;

Once you’ve prepared, you can start email writing to clients as prescribed in the steps below.

These tips will make your email stand out and increase your chances of getting a positive response.

To help you get started, here are some sample emails asking for business opportunities. Feel free to customise them according to your situation and style, and remember to personalise them as much as possible.

Here’s a sample email to a client asking for work using cold outreach:

Below is a sample email to approach a new client for freelance work after seeing a job post.

Given below is a sample email to the client asking for requirements.

Writing a professional and persuasive email is one of the most effective ways to ask for freelance work and land more clients. However, remember that every client and situation is different, and you need to personalise your email accordingly.&nbsp;

Don’t use generic or template emails that sound like they could be sent to anyone. Instead, do your research, tailor your message, and show genuine enthusiasm and passion for the project.

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A <a href="https://www.globaldata.com/data-insights/macroeconomic/number-of-self-employed-in-india-2137687/">global data report</a> revealed that India had 333 million self-employed people in 2021, a 7.6% increase from 2020.

But remote work is not a walk in the park. Indian freelancers face many challenges, such as unreliable internet, distractions, and time zone differences. How can you overcome these hurdles and thrive as a freelancer in India?

Here are some remote work hacks that remote workers worldwide have tried and tested, which will help you level up your game and crush it as a freelancer in India.

#1: Focus Like a Laser with Apps That Block Distractions

The distractions of Instagram, Reddit, Twitter, Netflix and other platforms are at your fingertips when you work remotely. How can you resist the temptation of hopping on to these apps and get things done?

Some apps have worked for fellow remote workers to ensure <a href="https://selfcontrolapp.com/">self-control</a>.&nbsp;

However, if you’re looking for a better <a href="https://www.meetsidekick.com/">Sidekick</a> to your hero side hustle-try this one:

Some of the other apps that you can use are <a href="https://www.forestapp.cc/">Forest</a>, <a href="https://todoist.com/integrations/apps/pomodone">PomoDone</a>, and <a href="https://freedom.to/">Freedom</a>. You can also try alternatives like browser extensions and offline methods, such as turning off your phone and using a timer.

#2: Collab Like a Boss with Cloud Crew HQ

Remote work translates to remote collaboration. You’re not in the office to turn towards someone and speak to them. Email can only go so far. You need a better way to communicate and collaborate with your cloud crew.

Another neat app that does the trick is <a href="https://swit.io/">Swit</a>!

These platforms have a huge advantage for seamless collaboration with your clients and remote teams. Here’s a <a href="https://docs.google.com/spreadsheets/d/1X3UlrXsyMT9waTYXSbezWKUluVlrRUugDAJgZqzPnBA/edit#gid=1397467689">list of more apps</a> to help you hack remote collaboration.

Thanks to the advances in artificial intelligence, you can get your own AI butler who can handle various tasks for you, such as scheduling meetings, organising notes, and summarising information. You can also chat with them and get personalised feedback and support.

Remote workers have been creative with using ChatGPT to help achieve this step.

If you’re sceptical about creating your personal AI assistant, say hello to Hello.ai!

You might have some privacy concerns about sharing your data and conversations with these assistants. However, they are designed to be secure and respectful of your privacy. You can also choose what you want to share and how you want to interact with them.

#4: Escape the Lonely Island (But Keep the Good Vibes)

Remote work can feel, well, remote. You might miss the social interaction and the buzz of the office. You might feel isolated and unmotivated, like this particular remote worker.

Use platforms that simulate a virtual coworking space with background noise and social interaction. These work-from-anywhere apps let you join or create rooms where you can listen to ambient sounds, such as a coffee shop, rain, or fireplace, and chat with other remote workers from around the world.

You can also try alternatives like online communities and forums for freelancers, where you can share your experiences, challenges, and tips with others.&nbsp;

#5: Communication is Key (and Don’t Be a Ghost!)

The key to effective communication is to use the right tools and methods for different situations. For example, you can use email for formal and official communication, such as contracts, invoices, and feedback.&nbsp;

But communication is not just about the tools and methods. It’s also about the style and tone. You need to be aware of the cultural differences and preferences of your clients and collaborators and adapt your communication accordingly.&nbsp;

Some of the tools mentioned below work for teams and for individual remote workers.

Here’s <a href="https://www.springworks.in/blog/remote-work-tools/">a complete list of other tools</a> you can use.

The bottom line is: don’t be a ghost. Don’t disappear or ignore your clients and collaborators. Don’t leave them hanging or wondering what’s going on. Be responsive, proactive, and transparent. Communication is the ultimate work-from-home hack here to build trust and rapport and ensure a successful and satisfying freelance project.

Bonus: Prioritise Well-being and Prevent Burnout

You need to balance your work and life and make time for yourself.&nbsp;

Also, take breaks, get enough sleep (seriously!), and set boundaries between your work and personal space.

You can also use resources like <a href="https://www.headspace.com/">Headspace</a>, <a href="https://www.calm.com/">Calm</a>, and <a href="https://www.betterhelp.com/">BetterHelp</a> to practise mindfulness, meditation, and therapy.

The most important thing is to create a personalised self-care routine that works for you. Find what makes you happy and relaxed, and do it regularly. It could be reading a book, listening to music, playing a game, or anything else. Treat yourself well and reward yourself for your hard work!

Working remotely as a freelancer in India can be challenging, but also rewarding and fulfilling. Overcome the challenges and thrive as a freelancer by using these working-from-home hacks and tools.

These hacks and tools can help you improve your productivity, efficiency, creativity, and satisfaction as a freelancer. Experiment and find the combination that works best for you.

Check out these links and keep hustlin’!

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Securing funding is vital to bringing your startup ideas to fruition. Without ample financial resources, even the most innovative ideas may face challenges in gaining traction.

A study by <a href="https://www.skynova.com/blog/top-reasons-startups-fail">Skynova</a> revealed that lack of financing led to the failure of 47% of startups in 2022.&nbsp;

Fortunately, a range of funding options are available to startups, each with unique advantages and considerations. This blog lists various funding options for entrepreneurs seeking capital.

Bootstrapping means using personal resources and business revenue generated to fund itself. It offers several benefits, including independence from external investors and complete control over decision-making processes.&nbsp;

It allows the <a href="https://www.skydo.com/blog/what-is-your-role-as-a-tech-startup-founder?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">founders</a> to adapt quickly to market changes without sharing equity with investors. However, gathering enough funds can take a lot of work, leading to financial risks and potentially slowing growth compared to funded startups.

Here are some strategies for bootstrapping.

Debt financing includes borrowing money from external sources with the obligation to repay it over time, typically with interest. Various types of loans are available to startups, including the following.

Now, let’s explore the pros and cons of debt financing.

Equity financing is a mode of startup funding that raises capital by selling the company's ownership shares, i.e., equity shares to investors. Common sources of equity financing for startups include the following.

Here are a few pros and cons of equity financing.&nbsp;

Government grants and competitions offer non-dilutive funding and validation for startups, particularly those in specific industries or with social impact. The objective is to support <a href="https://www.skydo.com/blog/eleven-proven-strategies-grow-it-service-business?utm_source=blogs&amp;utm_medium=website&amp;utm_campaign=post_link">innovation</a>, research, and development across various sectors.

A startup must navigate the application process, which often includes submitting proposals and business plans and meeting criteria set by the granting organisation or competition organisers.

Here are some of the schemes introduced by the <a href="https://www.startupindia.gov.in/">Government of India</a>.

Granting organisations and competition organisers evaluate applicants based on factors such as startup ideas, feasibility, social impact, and potential for commercialisation.

Selecting the appropriate funding option requires careful consideration of the startup's needs, stage of development, and risk tolerance. Below are some of the key factors to consider in startup funding.

Securing funding is a critical milestone in the startup journey, and understanding the various financing options empowers founders to make informed decisions.&nbsp;

Whether through bootstrapping, debt financing, equity financing, grants, or competitions, each funding avenue offers unique advantages and considerations.&nbsp;

By evaluating the options based on their needs and goals, founders can position their startups for success while preserving their vision and values.&nbsp;

It's advisable to conduct further research and seek professional guidance before committing to any funding arrangement.