Fintech firms are preparing for a major expansion in cross-border payments after the Reserve Bank of India began issuing licences under its new Payment Aggregator–Cross Border (PA-CB) framework. The move has replaced the earlier OPGSP (online payment gateway service providers) structure and gives non-bank payment firms direct regulatory approval to handle international collections and payouts, removing long-standing dependence on banks and opening a significantly larger business opportunity.
Razorpay, Cashfree Payments, Pine Labs, PayGlocal, Skydo, BriskPe and Exim Pe are among the firms that have secured the authorisation, which executives say is already changing how they operate.
Regulatory Independence
Under the previous model, banks had to apply to the RBI on behalf of fintechs, and any withdrawal of the partnership meant the fintech lost its authorisation instantly. “Under OPGSP, a bank would apply to RBI on your behalf. If the bank decided to end the partnership, your authorisation ended too,” Movin Jain, co-founder of Skydo told Fe. The new licence recognises these companies as regulated entities, enabling them to choose their banking partners, streamline compliance and build technology systems without being bound to a bank’s internal processes. “That regulatory independence completely changes how we operate,” Jain added.
Market Opportunity
The shift comes at a time when export and digital commerce sectors are expanding, creating demand for faster and more transparent cross-border payments. MSME exports rose to Rs 12.39 lakh crore in FY25 from Rs 3.95 lakh crore in FY21, with the number of MSME exporters more than tripling during this period. Companies such as Skydo, which caters to small and mid-sized exporters, said the licence gives them room to scale as more MSMEs sell to global buyers and look beyond traditional bank-led payment channels.
The RBI introduced the revamped framework in 2023 and has steadily issued licences since, aligning with the government’s goal of reaching $1 trillion in exports by FY26. Investor interest reflects this momentum. Skydo recently raised $10 million in a Series A round led by Susquehanna Asia Venture Capital, signalling confidence that fintech-led cross-border infrastructure will be essential for exporters in services, e-commerce and software.
According to consultants, banks have historically dominated the import–export payments space but often relied on intermediaries, including domestic and foreign non-banks, to support merchant flows. Bringing these entities directly under the RBI offers more predictable compliance norms and higher transaction limits. “Cross-border e-commerce is expected to pick up steadily, and there is a need for more targeted regulation,” Vijay Mani, partner, banking and capital markets leader at Deloitte, said. Industry experts pointed out that a dedicated framework had become necessary as global commerce increasingly shifts to digital channels.
Fintechs also see strong financial incentives. Cross-border transactions typically offer higher margins than domestic payments because they include both transaction fees and foreign exchange spreads. At the same time, growing trade linkages with Southeast Asia, the Middle East and Africa are creating more active currency corridors and increasing the volume of payments requiring digital collection tools. “As India builds stronger trade and financial ties with new markets, we will see more currency corridors become liquid,” Yashraj Erande, partner and director, BCG India said. He added that the country’s push to export its digital public infrastructure and fintech capabilities strengthens the opportunity for cross-border payment providers.
Cashfree Payments, which began developing its cross-border stack in 2021, said the segment now accounts for about 10% of its revenue and has grown more than 200% in transaction volumes year-on-year. “The new licence has created a level playing field,” Aakash Sinha, co-founder and CEO of Cashfree Payments said, adding that the earlier OPGSP model “was not standard and every bank used to interpret it differently”. Cashfree recently partnered with JP Morgan Payments, which is serving as its authorised dealer category-I bank. PA-CB rules require fintechs to partner with AD-I banks to execute foreign exchange transactions and ensure compliance with Fema and RBI norms. Even so, most operational and risk responsibilities remain with the fintechs, which must invest in technology infrastructure, merchant onboarding and monitoring systems.
Competition remains early, with banks still handling most export and import flows. But fintechs are gaining traction among smaller exporters, Internet-first brands and software firms seeking faster settlements and simpler onboarding than banks typically offer. With cross-border commerce expanding and India deepening its trade footprint, fintechs see this as a defining moment to build the payment rails that will support future global flows. “Enterprise value will eventually shift to whoever controls these rails. That’s why fintechs want to build early,” Erande said.