Foreign Inward Remittance Certificate (FIRC) is a key term for anyone in India receiving payments from abroad,&nbsp; be it exporters shipping goods overseas or freelancers offering services to international clients. 

FIRC full form is Foreign Inward Remittance Certificate, and it serves as an official proof that money has been remitted into India from a foreign sourceskydo.com. In simpler terms, a FIRC is a document issued by an Indian bank to verify and record details of an incoming foreign payment – including the sender, recipient, amount, and purpose of the transactiondbs.com. 

This certificate is crucial in the Indian context as it ensures your foreign earnings are transparent, properly documented, and compliant with regulations. In this guide, we’ll explain what FIRC means, why it’s important, how it works under RBI rules, and how Indian businesses or freelancers can obtain and use FIRC effectively.

FIRC stands for Foreign Inward Remittance Certificate, and as the name suggests, it is a certificate provided by banks in India to verify a foreign currency remittance received in the country. The FIRC contains important information such as the amount received, the foreign sender’s and Indian recipient’s details, and the reason for the payment. Essentially, it’s a tangible proof of an inward remittance – functioning as a testimonial that an individual or business in India has received a payment from abroad.&nbsp;

FIRCs have historically been issued by Authorized Dealer (AD) banks whenever an export payment or any foreign inward payment came in. For example, if an exporter in Mumbai sells goods to a buyer in Europe and receives the payment in USD into her Indian bank account, the bank would issue a FIRC confirming that the foreign payment was received. This document legitimizes the transaction and is often required by various authorities for reference. Only banks licensed as Authorised Dealer Category I by the Reserve Bank of India (RBI) can issue FIRCs, since they are the ones permitted to handle foreign exchange transactions in India.&nbsp;

It’s important to note that “FIRC” is sometimes used informally to refer to similar documents like Foreign Inward Remittance Advice (FIRA) or Foreign Inward Remittance Statement (FIRS). We will discuss these terms later, but broadly speaking, all of them serve a similar purpose: proving that a foreign remittance was received. In summary, a FIRC (Foreign Inward Remittance Certificate) is the official proof of foreign money coming into India, making it an indispensable document for cross-border payments.

Whether you are an Indian exporter, a service provider, or a freelancer, obtaining a FIRC (or its equivalent advice) for your foreign earnings is very important. Here are the key reasons why FIRCs matter:

In summary, the FIRC is more than just a piece of paper – it is essential for compliance, for availing financial benefits, and for maintaining clean financial records of foreign income.&nbsp;Especially in India’s tightly regulated foreign exchange environment, this certificate (or its modern digital equivalent) becomes a cornerstone for anyone dealing with international payments.

FIRC in India: RBI Guidelines and the Switch to FIRA

It’s important to understand how FIRCs are handled in India today, because there have been regulatory changes in the past decade. Historically, banks issued a physical FIRC on security paper for every foreign inward remittance received against exports. However, since 2016, the RBI changed the process for most cases. Let’s break down what that means:

In conversations around FIRC, there are a few more terms that get frequently mentioned, one of them being eFIRC. So what exactly is <a href="https://www.skydo.com/blog/efirc-firc-brc-essentials-differences">eFIRC?</a>

Two acronyms often discussed together are FIRC and BRC. They are related but not the same thing. We’ve explained FIRC (proof of receiving foreign payment). BRC stands for Bank Realisation Certificate. Here’s how they differ and how they work together, especially for exporters:

In summary, BRC is the second step in the documentation chain for exports: first get your FIRC/FIRA (proof of payment), then that leads to a BRC (proof that payment matches an export transaction). Both are important for exporters, but they serve different (complementary) purposes.&nbsp; This decison tree will help you decide if and when will you need FIRC/BRC

This is a sample FIRC document. All crucial remittance details have been masked for security purposes. Now let’s break the content of a FIRC down: 

How to Obtain a FIRC (Procedure to Get the Certificate)

Obtaining a FIRC or the equivalent remittance certificate is not an automatic process in many banks – often, you need to request it. Here’s a step-by-step on how Indian businesses or freelancers can get their FIRC/FIRA from the bank:

<a href="https://www.skydo.com/blog/how-to-get-firc-certificate-online">Getting a FIRC</a> might sound like a hassle, but with Skydo, it's a breeze. Our fully automated payment system along with built-in partnerships with banks, ensures effortless compliance with RBI guidelines, without needing any manual intervention.

When you receive an export payment through Skydo, we automatically generate the required FIRC for you at no extra cost. Just log into our user-friendly dashboard, and you'll find your FIRC ready to download, complete with all the details you need. 

Exporting goods and services is considered Zero-Rated Supply, meaning it is subject to 0% GST. However, to claim a GST refund for the input tax credit, exporters must provide the required documents including FIRC. These documents authenticate that the business is claiming a refund because it exported services and couldn't offset its input tax credit as it would in normal domestic business. Without FIRC, claiming a GST refund may not be possible

As we surge in cross-border transactions, ensuring compliance and safeguarding against illicit activities has become a pressing concern. However, at Skydo, we believe your focus should be on advancing your business, not on grappling with compliance challenges.

With Skydo, enjoy seamless international payments, delivered promptly and without any hidden fees. But that's just the beginning! Every time you receive a cross-border payment, an auto-generated FIRC is readily available for you to download, relieving you of compliance burdens so you can devote your energy to what truly matters: driving your business forward.

What is FIRC? Learn the full form, meaning, and how Indian exporters & freelancers can get FIRC or FIRA to claim tax benefits and stay RBI-compliant.

FIRC Full Form, Meaning & Guide for Exporters

Dive into the world of FIRC. Explore the full form, importance, and process of obtaining FIRC for your international transactions

Foreign Inward Remittance Certificate (FIRC): Full form, meaning and RBI guidelines

Prashanth

small_63aec75c493ff751315d72ac_63948a436dc07c0bec0374ea_uA3i3IUVLPHk_-xjAlW9Z7bxKaOLRCylGX1byeHyzyE.png

thumbnail_63aec75c493ff751315d72ac_63948a436dc07c0bec0374ea_uA3i3IUVLPHk_-xjAlW9Z7bxKaOLRCylGX1byeHyzyE.png

Prashanth Kumar

As an Indian importer or international trader, you may have occasionally spotted the mysterious purpose code "1501" on your bank statement. Purpose code 1501 primarily deals with refunds and rebates associated with imports. In this blog post, we will discuss this purpose of code, explain its importance and look at a few common scenarios where code P1501 is used.

Before we dive into the details of purpose code 1501, here's a brief snapshot of Purpose Code 1501:

With the Reserve Bank of India (RBI) releasing its <a href="https://kpmg.com/us/en/taxnewsflash/news/2025/04/india-revised-draft-export-import-regulations.html">revised draft </a>of the 'Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2025' on April 4, it’s crucial for businesses to stay informed about these changes to ensure ongoing compliance and avoid surprises down the line."

Purpose Code 1501 in India specifically denotes transactions related to refunds or rebates received on account of imports. This code signifies that you've received money back from foreign entities associated with goods or services previously imported into India.&nbsp;For example, imagine you run a business in India that imports electronic components from China, assembles them locally, and sells the final product. If one of the components you imported turns out to be faulty and you file a complaint, the supplier may issue a refund for the defective part. This refund would need to be categorized under Purpose Code P1501.

Why is Understanding Purpose Code 1501 Important?

Note that the purpose code 1501 is used specifically for inward remittances (receiving refunds) related to imports. For outward remittance, i.e for sending refund abroad, purpose code S1501 is used.

Claiming Import Duty Refund Using Purpose Code 1501

Imagine you're an importer in India and you've just received a shipment of goods from overseas. Let's say you paid some import duty on these items. Now, for some reason, maybe a few items were damaged, or you were overcharged, you're due a refund on that duty. Here's a simplified look at how that refund might come back to you and where Purpose Code P1501 plays a role:

So, in simple terms, if you get an import duty refund that comes from a company or entity outside of India, your bank will use Purpose Code P1501 to categorize this money coming into your account. It's like a special tag that helps everyone understand the reason for the transaction.

How to Select the Right Purpose Code for Your Transaction?

Choosing the correct purpose code is crucial to ensure smooth and compliant transactions, especially when dealing with international payments. If you're receiving funds from abroad related to imports, such as refunds, rebates, or adjustments, Purpose Code 1501 should be used.

Before finalizing any transaction, carefully review the nature of the payment to confirm it accurately reflects the purpose of the funds. For instance, if the payment is not related to an import-related refund or rebate (e.g., a personal remittance from abroad), a different purpose code would be applicable.

To avoid discrepancies or delays, ensure you have all the necessary documentation to support the use of Purpose Code 1501. This may include:

If you're uncertain about the appropriate purpose code for your transaction, consult your bank or a financial expert. Using the wrong code can lead to delays in processing, scrutiny from regulatory authorities, and even potential penalties.

By carefully selecting the correct purpose code, you can ensure smooth and compliant transactions while maintaining accurate financial records.

large_P1501_Purpose_Code_Thumbnail_1246x896.png

medium_P1501_Purpose_Code_Thumbnail_1246x896.png

small_P1501_Purpose_Code_Thumbnail_1246x896.png

thumbnail_P1501_Purpose_Code_Thumbnail_1246x896.png

P1501_Purpose_Code_Thumbnail

Most new exporters find the trade paperwork overwhelming. There are numerous documents involved and, without experience, it’s easy to feel lost in a spiral of confusion. If you’re in a similar situation, don’t worry, you’re in the right place. Among the various export documents, the proforma invoice is one of the most frequently used worldwide. Is it the same as a regular commercial invoice? Not exactly. It plays a different role in international trade.

In this guide, we’ll cut through the confusion and explain what a proforma invoice is, why it’s used, and how to create one. We’ll also highlight its format with examples and templates, especially from an exporter’s perspective, and answer some common questions. Let’s dive in!

A proforma invoice is essentially a preliminary invoice or quotation in an invoice format provided to a buyer before a sale is finalised. In other words, it’s a document that outlines the estimated details of a transaction,&nbsp; including goods, quantities, prices, delivery terms, etc., before the actual goods are shipped and before any payment is due. This helps both the exporter (seller) and the buyer agree on the terms in advance. Unlike a standard commercial invoice (which is issued after the goods are delivered and is used for payment and customs), a proforma invoice is not legally binding and does not demand payment. Think of it as a good-faith estimate or a formal quote rather than a finalised bill.

In practice, a proforma invoice serves as a negotiation tool and a blueprint for the sale. It defines key transaction details upfront so that both parties share a mutual understanding before proceeding. For example, it will typically include item descriptions, quantities, prices, weight/dimensions of shipments, freight charges, expected timelines, and terms like Incoterms and payment method. By providing all this information early, the proforma invoice helps streamline the sales process and avoid back-and-forth confusion.

Scenario: Imagine a textile exporter in India who receives a bulk inquiry for 1,000 meters of silk fabric from an overseas buyer. The exporter is eager to close the deal but isn’t sure about the exact shipping costs or applicable customs duties yet. In this case, they would issue a proforma invoice to the buyer listing the fabric cost, an estimated shipping cost to the buyer’s country, potential customs or import duties, and any other fees. This estimated invoice gives the buyer a clear picture of the total cost breakdown. The buyer can then review this proforma invoice and use it to negotiate if needed, make an informed decision, arrange for import permits or a letter of credit, and even begin setting up financing. All of this happens before any actual shipment or payment.

In summary, a proforma invoice outlines the agreement in principle. It’s “pro forma” (Latin for “for the sake of form”) – basically a document provided as a courtesy to ensure everyone is on the same page. It must later be followed by a commercial invoice (the final bill for payment) once the goods or services are delivered.

Exporters and international businesses use proforma invoices for a variety of strategic reasons. If you’re wondering when or why you might issue a proforma invoice instead of a simple quote or waiting for the final invoice, here are the most common reasons:

In short, proforma invoices are a versatile tool – they build trust, help with administrative processes, and reduce misunderstandings. Many experienced traders will say it’s better to issue a proforma invoice upfront, even when not asked, especially for first-time or high-value international customers, to make sure everything is agreed in writing.

Proforma Invoice Format &amp; Key Components

Now, let’s talk about the format of a proforma invoice – what does it look like and what information should it contain? In most respects, a proforma invoice’s layout is very similar to a standard commercial invoice, with the crucial difference that it’s labelled “Proforma” and is issued before the sale is final. Your proforma invoice should include all details the buyer (and authorities) need to understand the offer. Here are the key components to include in a proforma invoice format for export:

Here are two sample proforma invoices to give you an idea about the presentation of the above details:

(The above image is a sample for illustration; proforma invoices can vary in design but should contain all the essential components listed.)

You can design your own proforma invoice in Word/Excel or use an export documentation software. What matters most is that all the necessary information is presented clearly and truthfully, as this document will set the expectations for the entire transaction. Remember, any changes after issuing the proforma invoice should be communicated and agreed upon; ideally, a revised proforma would be issued if significant terms change. Once the buyer agrees to the proforma invoice, you’re ready to move ahead – produce the goods, arrange shipment, and later issue the formal commercial invoice matching the agreed terms.

Is Proforma Invoice Required For Indian Exporters?

A proforma invoice is not legally compulsory for Indian exporters, but it has become an essential document in the export sales process. For you as an exporter, a proforma invoice acts as a preliminary document that confirms the importer's order and provides a detailed breakdown of shipment costs. It also becomes a foundational document that you can use to prepare the final commercial invoice.

From an importer's point of view, the proforma invoice gives them detailed information on the goods they will receive. It specifies the item quantity, price, and other relevant transaction information. This ensures transparency and mutual understanding between you and the importer before any goods are shipped.

The other significant advantage of a proforma invoice is its ability to establish payment arrangements. You can use it to set up letters of credit or to secure trade financing.

In summary, while the law does not mandate a proforma invoice, it is a good practice to follow. It provides a detailed, preliminary account&nbsp;of the transaction, builds trust and transparency with the buyer, and reduces financial risks.

How to Create a Proforma Invoice (Step-by-Step)

Creating a proforma invoice is straightforward if you follow a checklist. Think of it as preparing a formal quote that mirrors the structure of a final invoice but is issued before the sale is finalised.

Here’s a simple step-by-step guide to create your own proforma invoice:

One more thing: Once a proforma invoice is accepted by the buyer, avoid making changes unless absolutely necessary, and if you do, inform the buyer and issue an updated proforma. Consistency and honesty on the proforma build trust – the buyer will plan based on that document (e.g., arrange financing and import paperwork). In fact, changes to a proforma invoice shouldn’t be made without the buyer’s consent, because it’s considered a gentleman’s agreement. So treat your proforma invoice with almost the same care as a final invoice.

Receive Seamless Export Payments With Skydo

A proforma invoice can’t get you paid on its own – it’s not a payment demand or a legally enforceable invoice. It’s a step toward closing the deal. But after your buyer agrees to the proforma and you ship the goods, you’ll move to the commercial invoice and payment phase. This is where having a reliable invoicing and payment platform becomes crucial. Skydo offers exporters like you a comprehensive solution to manage invoices and collect payments globally with ease.

How can Skydo help you? Here’s what our platform enables you to do:

&nbsp;Ready to revolutionise your export invoicing and payments? Sign up for Skydo today and take your business global with confidence!

Proforma Invoice: Meaning, Format And Template

large_Proforma Invoice: Meaning, Format And Template

medium_Proforma Invoice: Meaning, Format And Template

small_Proforma Invoice: Meaning, Format And Template

thumbnail_Proforma Invoice: Meaning, Format And Template

Last Updated: October 2025 (with latest form info and tips)

What is Form W-8BEN and Who Needs It? (For Indian Freelancers)

If you're an Indian freelancer, service provider or contractor working with U.S.-based clients. Form W-8BEN is your lifeline to getting paid without losing <a href="https://www.irs.gov/instructions/iw8ben">30% to U.S. taxes</a>. Form W-8BEN’s official title is “Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals).” In simple terms, it’s a one-page form where you declare:

By making these certifications, W-8BEN lets you invoke the India-U.S. <a href="https://nadt.gov.in/writereaddata/MenuContentImages/India%20US%20Double%20Taxation%20Avoidance%20Treaty635480255452005394.pdf">Double Taxation Avoidance Agreement (DTAA) </a>to reduce the standard 30% withholding tax to a lower rate (often 0% for service income). Essentially, Form W-8BEN tells your U.S. client or platform that you’re an “international” payee and they should not deduct 30% upfront.

Without this form, the payer is legally required to withhold 30% of your payment and remit it to the IRS&nbsp;– money you would then not get until perhaps a refund claim much later (if at all). Clearly, you want to avoid that scenario by filing W-8BEN.

Any Indian individual earning income from the US: this includes freelancers, consultants, remote employees, content creators, developers, designers, etc., as long as you are getting paid in your personal capacity. Even Indian students or scholars in the US receiving certain stipends might need to fill this. If you are providing a service or receiving any taxable income from a U.S. source as an individual, the W-8BEN is likely required. (Indian businesses have a separate form, W-8BEN-E, discussed later.)

Typically, before the first payment. Many platforms (Upwork, Freelancer, Amazon KDP, stock brokerages) will prompt foreign users to submit a W-8BEN. Clients might ask for it during onboarding. It’s not a form you send proactively to the IRS – you fill it out and give it to the payer so they have it on file. If you change your status (say, move to the U.S. or become a U.S. taxpayer), you’d need to update it; otherwise, just renew it every three years.

&nbsp;How to Fill Form W8BEN India: Step-by-Step Guide

Filling out Form W-8BEN for the first time can seem daunting, but it’s actually straightforward. Below is a line-by-line breakdown tailored for Indian freelancers and independent contractors. Before you begin, always download the latest W-8BEN form from the official IRS website (currently the October 2021 version) – using an outdated form is a common mistake that can lead to rejection or delays

For reference, here’s how the top section of Form W-8BEN looks:

Part I: Identification of Beneficial Owner (India)

In this section, you provide your personal details. Fill it as follows:

This is the heart of the form for reducing withholding. As an Indian, you’ll invoke the <a href="https://www.irs.gov/pub/irs-trty/india.pdf">India-U.S. Tax Treaty here:</a>&nbsp;

In summary, Part II is where you claim “I’m an Indian resident and my income qualifies for treaty exemption, so only 0% should be withheld instead of 30%.”

Finally, read the certification text (it’s basically affirming that everything you provided is true and you are not a U.S. person, etc.). Then:

That’s it! The W-8BEN form is just a single page. Do not attach any documents (no need to attach PAN copy or anything unless specifically asked by the requester). Simply submit this form to your client or platform as instructed. Usually, you’ll upload it through a portal or email a PDF. Remember, do not send it to the IRS directly.

To illustrate the benefit: Priya is a freelance graphic designer in Mumbai earning $50,000 (about ₹40 lakh) from U.S. clients annually. Without a treaty, $15,000 would be withheld as tax (30%). By submitting W-8BEN citing Article 15, Priya’s U.S. clients withhold 0%. She thus saves ₹12 lakh in taxes each year, only paying applicable taxes in India. This shows how crucial the form is for your bottom line!

You can also download <a href="https://www.irs.gov/pub/irs-pdf/fw8ben.pdf">Form W8BEN right here</a>

Form W8BEN-E for Indian Businesses: Complete Guide&nbsp;

If you operate as a business entity (for example, a Private Limited company, LLP, Partnership firm, etc., registered in India) and you are receiving payments from U.S. clients, you’ll use Form W-8BEN-E instead.

The W-8BEN-E (officially “Certificate of Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities)”) serves the same purpose for companies that W-8BEN does for individuals – it certifies your foreign status and tax treaty eligibility – but it’s a longer form (because it collects entity-specific information like organisation type and FATCA status).

Don’t be intimidated by W-8BEN-E’s length (8 pages); most Indian service businesses only need to fill a few relevant parts. Let’s break it down simply:

Part I – Identification of Beneficial Owner (Entity Information):

Part II: Disregarded Entity or Branch Receiving Payment

This part is usually skipped by Indian businesses that are simply paid directly. It’s only relevant if the payment is going to a branch that isn’t the main entity. Most can ignore Part II entirely

&nbsp;Part III: India-US Tax Treaty Claims

This is crucial for reducing withholding under the treaty as per the<a href="https://www.irs.gov/pub/irs-trty/india.pdf"> India-US tax convention</a>, akin to Part II on the individual form.

Parts IV – XXVIII: These are various certifications for different entity types (financial institutions, governments, nonprofits, etc.). The good news is that if you are a standard business entity (exporting services, software, etc.), you often can skip a lot of these parts. The W-8BEN-E form is designed to cover everything from banks to tax-exempt orgs. For a typical private limited/LLP providing services:

(Note: On the form, the certification is usually the last section, sometimes labelled Part XXX or simply the signature block at the end.)

That’s it. While the W-8BEN-E looks long, most Indian businesses only fill 2-3 pages of it; the rest can be left blank or marked not applicable. Always double-check the instructions if in doubt – but the above covers the usual case for Indian entities.

ABC Web Solutions Pvt Ltd in Bangalore earns $100,000 (₹83 lakh) from U.S. clients. Without a W-8BEN-E, each client would withhold $30,000 total (30%). By claiming treaty benefits with W-8BEN-E under Article 7, 0% is withheld in the U.S. ABC only pays tax in India on that income. This saves them roughly ₹25 lakh in taxes annually that would otherwise have been stuck in the U.S.

India-US Tax Treaty Benefits: Things to Note

Both W-8BEN and W-8BEN-E rely on the India–U.S. Double Taxation Avoidance Agreement (DTAA) to eliminate or reduce withholding tax. Here are the treaty provisions most relevant to these forms:

Always quote the treaty article and its paragraph when claiming benefits on the form, as we showed. It’s important to be precise so the withholding agent accepts your claim. If unsure, consult the India-U.S. Tax Convention text&nbsp;or IRS instructions, which list which articles correspond to which types of income.

Form W8BEN and W8BEN -E Download &amp; Submission Process

Always get the forms from an official source. You can download the latest PDF of Form W-8BEN directly from the <a href="https://www.irs.gov/forms-pubs/about-form-w-8-ben">IRS website</a>, and the latest Form W-8BEN-E as well. Using the current version is crucial – outdated forms are a common reason for rejection or delays in processing. The forms come with instructions if you need further guidance.

Once filled and signed, submit the form to whoever requested it (and never to the IRS directly). Here’s how it works in practice:

Keep a copy of your filled form for your records. And if you change your name, address, citizenship, or if a company’s ownership structure changes, you should fill out a fresh W-8 form and send it promptly (within 30 days of the change, per IRS guidelines).

Common Form W8BEN&nbsp; and W8BEN-E Filing Mistakes to Avoid (India)

Filling W-8 forms is straightforward, but certain mistakes can lead to withholding issues or forms being rejected. Avoid these pitfalls:

By avoiding these mistakes, you ensure your form is accepted and you enjoy the full tax benefits allowed.

W8BEN vs W8BEN-E: Key Differences for Indians

Both forms are versions of the W-8 series used to establish foreign (non-U.S.) status and claim treaty benefits. The difference comes down to who is filing:

In short, if you earn in your name, use W-8BEN; if under a company name, use W-8BEN-E. Using the wrong form will result in having to re-submit the correct one, so when in doubt, remember: entities ≠ individuals.

(For completeness: There are other W-8 forms like W-8ECI for income effectively connected with a U.S. trade, W-8IMY for intermediaries, etc. But those are special cases. Most readers here will not need those.)

After Filing: Receiving Payments with Minimal Hassle

Filing your W-8BEN/BEN-E is a critical first step to ensure you’re not over-taxed. Once that’s done, the actual payment process is the next thing to optimise. Many Indian freelancers and businesses face high bank fees, poor conversion rates, and paperwork (like FIRA/eFIRC, purpose codes) when getting paid from the US. This is where Skydo can help streamline things.

Skydo provides Indian freelancers and companies with<a href="https://www.skydo.com/blog/virtual-account-numbers"> virtual U.S. accounts</a> and a platform to receive payments at live forex rates with zero hidden fees. Instead of paying high international wire charges or accepting marked-up conversion rates, you can get near-market exchange rates – meaning you keep more of what you earn. We also automatically handle compliance like purpose codes and FIRA generation for exports.

Pro Tip: Already filed your W-8BEN? Great – the hard part is over. Now, make sure you invoice your U.S. clients in USD and consider using Skydo to avoid losing 2-4% in exchange markups that banks often take. Over a year, those savings add up, just like the tax savings!

Focus on your work, not on chasing payments or worrying about taxes. With the W-8 form formalities done and a solid payment solution in place, you can concentrate on your core business.

How to Fill W-8BEN and W-8BEN-E Forms: A Guide for Indian Freelancers & Businesses

large_How to Fill W-8BEN and W-8BEN-E Forms: A Guide for Indian Freelancers & Businesses

medium_How to Fill W-8BEN and W-8BEN-E Forms: A Guide for Indian Freelancers & Businesses

small_How to Fill W-8BEN and W-8BEN-E Forms: A Guide for Indian Freelancers & Businesses

thumbnail_How to Fill W-8BEN and W-8BEN-E Forms: A Guide for Indian Freelancers & Businesses

If you’re billing overseas clients, from a SaaS subscription to a consulting invoice, you want three things: a. the payment to land on time, b. The INR you receive to be predictable, c. and the paperwork to be airtight.

This guide explains how Cashfree handles international payments, what it costs, what documents you get, and when a specialised exporter platform (like Skydo) might fit better.

Cashfree is a Bengaluru-based payments company. Domestically, it’s an RBI-licensed Payment Aggregator. For cross-border, it offers two ways to collect and settle in INR:

Let's take a moment to understand both these methods.&nbsp;

1) Global Collections Account (virtual accounts + local rails)

Best for: Invoices from overseas clients (freelancers, agencies, IT/consulting, SaaS).

In short: Feels like a “local bank account” for your client; you receive INR in India with per-payment FIRA.

2) International Payment Gateway (cards/APMs)

Best for: Online checkout flows (eCommerce, digital goods, subscriptions, SaaS).

In short: Optimised for conversion at checkout with multi-currency presentation; compliance comes as period summaries.

Cashfree International Payments Charges — what to expect

Use the International Gateway when:

Quick comparison: Global Collection Account vs Payment Gateway

A focused alternative for exporters: Skydo

While Cashfree gives Indian businesses multiple ways to collect payments, it’s still built to serve both domestic and international flows.
If you’re an exporter or freelancer who deals primarily in foreign payments, Skydo might be a better fit because it’s designed only for that.

With Skydo, you get global bank accounts in your business’s name across major currencies like USD, EUR, GBP, CAD, and AUD.
Your clients can pay you through their local payment methods, ACH in the US, SEPA in Europe, Faster Payments in the UK, and the funds reach your Indian account at live forex rates with zero markup.

If your client’s in the US, you can even share an InstaLink; they can pay instantly via card (5%) or ACH debit (2%) at midmarket rates without any markup

Every payment comes with an instant FIRA and eBRC (for Amazon sellers).

In short, Skydo takes care of the entire export payment journey,&nbsp; from collection to compliance, without the guesswork or hidden forex costs. So try Skydo today and let us take on of your payment worries

Cashfree International Payments (2025): Global Account, Gateway, Charges & Alternative

large_Cashfree International Payments (2025): Global Account, Gateway, Charges & Alternative

medium_Cashfree International Payments (2025): Global Account, Gateway, Charges & Alternative

small_Cashfree International Payments (2025): Global Account, Gateway, Charges & Alternative

thumbnail_Cashfree International Payments (2025): Global Account, Gateway, Charges & Alternative

What is Remitly—and how does USD→INR work?

Your <a href="https://www.skydo.com/blog/how-to-receive-money-from-usa-to-india">US-based clients</a> can use Remitly Business to pay you if they are a US-based business. For USD→INR:

Practical tip: For any payout, compare Remitly’s quoted rate with the mid-market rate (the “Google rate”). The difference indicates your effective FX cost for that transfer.

How much does Remitly charge for USD to INR transfers?

Remitly’s fees appear straightforward at first, but the exchange rate significantly impacts the amount you actually receive.

The mid-market rate (the “Google rate”) is the real USD→INR rate without markup.
Remitly’s offered rate is usually slightly lower. For example, if the mid-market rate is ₹85.00 per USD, Remitly might offer ₹84.50—a ₹0.50 difference applied to every dollar sent. On a $5,000 transfer, that’s about ₹2,500 less received.

Remitly’s markup on USD→INR transfers generally falls between 0.4% and 1.4%, depending on the amount, market movement, and transfer speed.

Even if there’s no visible fee, the markup affects your payout.
Compare Remitly’s quoted rate with the mid-market rate before confirming a transfer; the gap between them is your true FX cost.

Real cost breakdown: what you actually receive

To understand how exchange rates affect your payout, here’s an example using approximate numbers for common transfer amounts.

*Based on a mid-market rate of ₹85.01 per USD, assuming an average forex markup of around 0.9%.
Actual markups can vary,&nbsp; and in some cases, may be higher,&nbsp; depending on transfer size, timing, and exchange-rate movement.

Once transfers exceed $1,000, the flat fee becomes less significant. The exchange rate markup continues to determine how much ultimately reaches your account.
On a $2,000 transfer, that difference translates to roughly ₹900 less received. Multiply that across recurring invoices or multiple clients, and the impact compounds quickly.

💡 Note: Exchange rates fluctuate throughout the day. Always check Remitly’s live USD→INR rate against the mid-market rate (the rate visible on Google or XE.com) to know your exact cost before confirming a transfer.

Remitly Business offers two ways to transfer funds, and your choice affects both how quickly you receive the money and the rate you get.

Typically takes up to 5 business days to reach your Indian bank account, but it usually comes with a more favourable exchange rate. This option works well for planned or recurring business payments where timing is flexible.

Deliver funds faster, often within a few hours or by the next business day. The trade-off is that Express transfers may use a slightly lower exchange rate compared to Economy.

In short, Economy favours value; Express favours speed. Choosing between them depends on whether you prioritise timing or maximising your payout.

Remitly Business deposits funds directly into your Indian bank account. They work with all major banks, including HDFC, ICICI, SBI, Axis Bank, and others.

Your client initiates the payment on their end through Remitly Business. Once processed, the money appears in your account - no need to visit a branch or collect cash.

Transfer limits and verification requirements

Remitly Business typically allows transfers of up to about $30,000 per transaction from the US to India. For most freelancers, agencies, and small businesses, this covers regular project or retainer-based payments comfortably.

However, this limit can vary. The actual cap depends on your verification tier, the transfer method used (Economy or Express), and Remitly’s risk assessment of your account. It’s always best to check your current limit in the app before your client initiates a large transfer — limits can change as your usage grows.

When you first set up Remitly Business, you’ll complete a basic verification process using your business and tax details. As your transaction volume or frequency increases, Remitly may request additional verification to comply with regulatory standards.

These checks are part of standard KYC (Know Your Customer) and KYB (Know Your Business) processes required for licensed money-transfer providers. They aren’t unique to Remitly; they apply across the financial industry.

If your expected payment exceeds your transfer limit, you have two options:

Keep in mind that splitting payments can lead to additional FX markups being applied to each transfer. For example, two × $20,000 transfers may cost slightly more overall than a single $40,000 payment on a platform with a higher limit.

💡 Tip: If you frequently receive large invoices or recurring international payments, explore solutions that offer higher limits and transparent flat-fee pricing, so your total costs remain predictable.

Compliance: India-specific rules that matter

When receiving international business payments, compliance is as important as speed or cost. For transfers from the US to India, it’s essential to use the correct Remitly service and maintain proper documentation for Indian regulations.

Consumer Remitly is for personal use only

The standard Remitly app operates under the Reserve Bank of India’s <a href="https://www.skydo.com/blog/what-is-lrs">Liberalised Remittance Scheme (LRS</a>), which is intended solely for personal remittances, for example, family support, gifts, or education expenses.

Using Consumer Remitly to receive business payments or export proceeds isn’t permitted. It falls outside LRS guidelines and also violates Remitly’s own user terms, which prohibit commercial transactions such as freelance payments, service exports, or product sales.

For legitimate business transactions, the sender (your US client) should use Remitly Business. It’s designed for US-registered companies, LLCs, corporations, or sole proprietors paying overseas vendors, contractors, or service providers.
This ensures the payment is correctly classified as a commercial transaction, keeping both sender and recipient compliant with US and Indian regulations.

Even when payments are made via Remitly Business, recipients in India must meet compliance obligations under RBI rules. Each inbound business payment requires:

Remitly doesn’t issue FIRA or eBRC; these must be requested from your Indian bank after each payment. Keeping these documents ensures your foreign income is properly recorded for <a href="https://www.skydo.com/blog/decoding-gst-on-foreign-exchange">GST filings</a>, audits, and export compliance.

Missing or delayed documentation can lead to complications during tax assessments or while claiming export benefits. The responsibility to maintain compliance lies with the recipient, not the payment platform.

💡 Tip: Always verify whether your client is using Remitly Business before accepting payments, and ensure you or your accountant collects FIRA/eBRC promptly after each transfer. Or consider platforms like Skydo, which take care of these compliance docs on your behalf.&nbsp;

A business-grade alternative: Skydo for Indian exporters

If you regularly receive payments from US clients, Skydo is built specifically for Indian businesses, freelancers, agencies, and SaaS exporters who want transparency, faster settlements, and built-in compliance.

Skydo provides the live mid-market exchange rate, the same one you’d see on Google, with zero markup.
Instead of adding hidden margins, it follows a simple flat-fee model:

This makes every transaction predictable; you know your exact cost before receiving the funds.

Skydo gives you two flexible options to receive payments: