How to Receive International Payments in India

Expanding your business globally has never been easier, thanks to the internet and social media. Sitting in India, you can easily work with clients from the US, UK, Australia, or anywhere in the world. As per the Ministry of Commerce and Industry, the estimated value of services export for January 2025 is USD 38.55 Billion as compared to USD 31.01 Billion in January 2024.

But the question of "How to receive international payments in India" continues to challenge businesses. However, cracking this can save you thousands, prevent compliance headaches, and ensure smooth, timely payments.

In this blog, we’ll break down the different ways to receive international payments in India, compare their costs and processing times, and help you find the best option for your business.

 How to Accept International Payments in India?

Here are the main ways to receive international payments in India

1.  International virtual accounts via Skydo, Payoneer, Wise:  Most suited for small to medium businesses and freelancers prioritizing quick settlement, lower fees and seamless process. 
2. Payment Gateways like PayPal: Most suited for freelancers and e-commerce platforms prioritizing multiple payment methods, integrations and global acceptability.
3. Banks: Most suited for big businesses having large payment volumes

4. Remittance platforms like Western Union and Wise P2P: More suited for personal transfers rather than business payments

Before deciding on your preferred way, it is important to evaluate each method on parameters like timeline, fees etc to find out which fits your needs the best. So let's understand these parameters in some detail:

Things to Note Before Receiving International Payments in India

Unfortunately, international money transfers, especially payments aren’t as straightforward as domestic ones. Different countries have different regulations and multiple financial institutions are involved in the process as well.

So here are a few things to watch out for before receiving payments from abroad:

Timelines

In India, we’ve become accustomed to instant payments thanks to UPI—just a quick scan, and it's done. However, international payments are a different story and the settlement time depends on the mode of payment primarily. For example, banks may take upto 7 business days to settle your payment while international virtual accounts can do it within 48 hours.

Compliance

International payments often undergo strict scrutiny due to concerns around money laundering and terror financing. Hence, when choosing your international payment platform, check if it is approved by the RBI, provides FIRA and has the necessary security certifications. For example, In January 2025, Skydo received in-principle authorisation from the Reserve Bank of India (RBI) to operate as a Payment Aggregator-Cross Border (PA-CB) entity ensuring the highest level of compliance and security.

Charges 

Charges are one of the key factors when deciding on how to receive international payments in India. You need to be aware of the fees associated with each payment platform and make sure there are no hidden fees that are sneaking in.

For example, most platforms including banks apply a markup on the ongoing exchange rate —if the actual rate is 1 USD = ₹84, banks might offer ₹82, with the small difference adding up over multiple transactions.

Similarly, platforms like PayPal charge a steep 4% currency conversion fee, along with an additional 4.4% transaction fee and a fixed fee, further eating into your payout. While some costs are unavoidable, being aware of these charges allows you to make smarter choices and maximize your earnings by opting for more cost-effective payment methods.

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Do I Have to Pay Tax on International Payments in India?

Exports in India are considered zero-rated supplies, meaning you don't have to pay GST on your export income if you receive your payment in foreign currency. 

However, note that regardless of whether you receive a salary from an overseas employer or payments from foreign clients as a freelancer or business, your income will be taxed in India based on the applicable income tax slab rates.

 Best Way to Receive International Payment in India

There’s no one-size-fits-all answer to the question of how to receive international payments in India—it all depends on what matters most to you. Whether it’s faster settlement, favourable exchange rates, easy compliance, or other factors, the right option will vary. 

In this section, we’ll break down the different payment methods based on these key parameters to help you decide which is the best way to receive international payments in India. 

Banks

Banks are often the traditional answer to the question of how to receive international payments in India, and online banking has made money transfer services more convenient as well. However, here are a few things that you need to know before deciding if banks are the right fit for you to receive international payments:

Timelines

International bank wire transfers can take upto 5 business days or even longer due to reasons like multiple intermediary banks, bank holidays, incorrect details etc. 

Compliance

Banks issue FIRA for every foreign payment but it is not a default or free service. You have to follow up with your bank to get your FIRA and banks often levy a fee for the same. Axis Bank for example charges INR 250 for every FIRA and an additional INR 100 for duplicate FIRA.

Charges

Bank fees for international payments include a SWIFT fee which while levied on the sender is often passed on to the receiver. It might cost your client anywhere around USD 15-50 to send the international payment and more often than not, it will be passed on to you.

Further, as we've mentioned banks mostly levy a forex markup, giving you a lower exchange rate than the market exchange rate. Let’s say you receive $5,000, and the real exchange rate is 1 USD = ₹84, so you expect ₹420,000. Instead, the bank offers a lower rate of ₹82 per USD, leaving you with ₹410,000—a loss of ₹10,000 on just one transaction. Beyond SWIFT and forex fees, banks tend to charge extra fees for various services. For example, Axis Bank charges ₹250 for issuing a FIRA and ₹500 to track SWIFT payments.

Payment Gateways like PayPal

PayPal's credibility and global reach make it a popular choice for online money transfers as well as for receiving international payments in India. So is Paypal the answer to, "How to receive international payments in India?" Let's find out: 

Timelines

If your client pays you via PayPal, the amount appears in your PayPal account almost instantly, but it can take up to 5 business days to reach your bank account.

Compliance

PayPal provides a monthly digital FIRA to businesses and freelancers. This FIRA covers all international transactions from the previous month, and it is only available by the 15th of the subsequent month.

Charges

PayPal fees for receiving international payments border on the steep side, which includes a 4.40% transaction fee, plus a fixed fee depending on the currency of the transaction along with 4% currency conversion fee to the prevailing exchange rate. For example, if the current market rate is INR 84 per USD, PayPal’s effective exchange rate would be 4% less, which is INR 80.64.. 

Virtual International Bank Accounts 

New-age fintech platforms like Skydo, Wise, and Payoneer are making cross-border payments seamless with international virtual accounts. These platforms provide users with virtual bank accounts in countries like the US, UK, and Australia. Clients in these countries can send payments to these virtual accounts as local transfers, avoiding the hassle and cost of international transfers.

The platforms then consolidate these local payments and transfer them to the recipient’s personal bank account.  Let's explore whether virtual accounts could be the answer to how to receive international payments in India.

Timelines

Once the payment hits your virtual account, it’s quickly transferred to your personal bank account. For example, Wise deposits funds within 0-2 business days, while Payoneer and Skydo mostly settle payments within 24 hours—all much faster than traditional bank transfers..

Compliance

Most platforms offering international virtual accounts in India also provide FIRA to their users. While Wise charges a fee for issuing FIRA, both Payoneer and Skydo offer it free and instantly, making the process smoother and more convenient for users.

Charges

Since virtual bank accounts skip SWIFT transfers, no SWIFT fees apply. However, each platform has its own charges:

Payoneer:

For a detailed breakdown, check Payoneer’s fees here.

Wise:

You can read more about Wise’s pricing right here. 

Skydo:

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Which platform should you choose to receive international payments in India?

If you’re a large business handling high volumes of cross-border payments, banks might be the answer to how to receive international payments in India. They often offer competitive exchange rates and personalized services that smaller clients might not receive.

Many businesses and freelancers also prefer PayPal for its global credibility and acceptance, offering a payment option their international clients are familiar with.

For individual freelancers and small to medium businesses, international virtual accounts are often the most practical choice. These fintech platforms provide a seamless payment experience without the hassle of dealing with banks. By bypassing the SWIFT network, they eliminate SWIFT fees and typically offer faster settlements. Many platforms also include FIRA to simplify compliance. However, before deciding on how to receive international payments in India, carefully review their fees, foreign currency conversion rates, and customer support to ensure they meet your needs.

Here's a quick comparison chart to help you decide the best way to accept international payments in India based on your needs:

How to Receive International Payments in India with Skydo?

While there are several ways to receive international payments in India, virtual bank accounts are quickly becoming the preferred option for businesses and freelancers due to their simplicity and affordability. With Skydo, setting up an international account takes just five minutes, helping you easily do business in markets like the US, Europe, Singapore, and Australia.

Skydo streamlines your payments by offering live Forex rates with no hidden fees or currency markups. To keep things hassle-free and compliant with RBI regulations, you’ll get instant FIRA downloads after every transaction. Plus, each user benefits from a dedicated representative who’s ready to provide guidance and support whenever you need it.

If you're looking to avoid high fees on international transfers and make your foreign payments seamless and compliant, Skydo is the perfect solution!