Compliance when paying India: purpose codes, tax IDs, export certificates and what the recipient's bank will ask

Short answer. Business payments in India are legal and routine; the paperwork is about proving what the payment was for. The recipient's bank may ask them for the invoice and the purpose of the payment; you keep the invoice, the contract and the Storspay receipt. Because Storspay delivers rupees through a local partner as a domestic credit, the recipient is not handling foreign currency and the questions are fewer than on an inbound wire.

On your side

Storspay verifies your business once (KYB — registration, directors, authorised signer) and every payment carries a reference you choose: the invoice, contract or fee-note number. Keep the invoice and the receipt together; that is what your accountant, your auditor and, if ever asked, your regulator want to see. Storspay screens every recipient and payment against sanctions lists and reports in Canada and the US as required.

On the recipient's side

Inbound business payments to India go through the recipient's authorised-dealer bank. The recipient's bank may ask for the purpose of the payment (a purpose code such as P0802 for software consultancy, P0801 for IT services, or the goods-export codes for merchandise), the invoice, and the recipient's PAN. Exporters of goods and services usually want a Foreign Inward Remittance Certificate (FIRC) or an e-FIRA from their bank to close the export entry and claim GST refunds — ask the recipient whether they need one before the first payment, and keep the Storspay receipt with the invoice on your side.

Contractor or employee?

Paying an independent contractor in India is a business-to-business payment: they invoice you, you pay the invoice, they handle their own tax. If the people you pay are employees of a company you own in India, that company runs payroll locally and you fund it — Storspay pays the company's account, not thirty personal accounts under a payroll you do not operate there. If you are not sure which you have, an employer-of-record or a local accountant can tell you in an hour.

What is different about India

India is the largest market for remote professional services on earth and a bank-first corridor: every salaried professional and every registered company has an IFSC-coded bank account, and domestic rails (IMPS, NEFT) clear in minutes. What matters to an Indian recipient is the rupee amount that actually lands, because wires from the US or Europe routinely arrive short after correspondent-bank charges and a hidden FX spread. Storspay converts once at the mid-market rate and shows the 1% separately, so the rupee figure in the notification is the figure in the account.

How a payment to India works on Storspay

1. Fund your balance in USD (ACH or wire), CAD (Interac e-Transfer or EFT), GBP (UK bank transfer) or EUR (SEPA) — to account details in your own business name. Funding is free.
2. Add the recipient once: their name as it appears on the account, the bank (HDFC Bank, ICICI Bank, State Bank of India, Axis Bank, Kotak Mahindra and every other IFSC-coded bank) and the account number. Storspay checks the account name before you confirm.
3. Type the amount in either box. Enter what you want to send and see the rupees that land, or type the rupees figure on the invoice and see what it costs you. The rate is the mid-market rate; the 1% is on its own line.
4. Confirm. The money goes over IMPS or NEFT and usually lands within minutes — the same business day at most. The recipient gets a notification with the exact amount, and you get a receipt with the invoice reference.

Nobody in India has to sign up, install an app or touch anything other than their own bank account. Everything on the recipient side looks like an ordinary domestic transfer.

What it costs

Storspay charges 1% all-in on payments to India, with a minimum of US$2, at the mid-market rate. That one line covers conversion, settlement and delivery; there is no FX markup, no intermediary-bank charge and nothing deducted on the recipient side.

Rates in this guide are the mid-market rate on the day of writing (1 USD = 96.9643 INR); the calculator on the homepage shows today's. Payments above ₹1,500,000 are split automatically under the local cap, under one reference and one fee.

See what your team in India receives →

Questions businesses ask before the first payment to India

Do I need a licence to pay people in India?

No. You are a business paying invoices. Storspay and its licensed partners hold the money-transmission and local-payout licences.

Will the recipient receive foreign currency?

No — a domestic credit in rupees. That is why the recipient's bank asks less than it would for an inbound wire.

What does Storspay report?

What Canadian and US rules require of a money-services business: verified customers, screened recipients, records kept for the statutory period. Nothing about your payments is sold or shared with anyone else.

Can I pay a UPI ID instead of an account number?

Not yet. Storspay pays Indian bank accounts by account number and IFSC code; UPI handles are on the roadmap. Every UPI-linked account has an ordinary account number you can use today.

Is there a limit per payment to India?

Payments above ₹1,500,000 are split automatically under the local cap, under one reference and one fee — a large invoice never becomes several trips to the bank.

Does the recipient pay anything?

No. Storspay charges you 1% all-in (minimum US$2); the recipient receives the rupee amount shown. Their bank may apply its own inward-remittance charge for issuing an FIRC — ask them, it is usually a few hundred rupees.

Who this is for — and who it is not for

Storspay is for businesses and organisations: companies, agencies, schools, hospitals, facilitators, foundations and sole traders paying other businesses and professionals for work, goods and services. A sole trader counts as a business and signs up in their own name.

What Storspay is not is a personal money-transfer service. We do not open personal accounts, and every payment has to be a business transaction: an invoice, a contract, a fee note, work delivered. Money to family and personal transfers are not what this is, and we would rather say so now than at verification.