Skydo, a Bengaluru cross-border payments company, has received final authorisation from the International Financial Services Centres Authority (IFSCA) to operate as a payment service provider (PSP) in GIFT City, it said on Tuesday, October 27. The IFSCA register shows Skydo Payments IFSC Private Limited registered as a PSP on October 21, five months after its in-principle approval in May.
Its first planned product is a GIFT City multi-currency account for eligible Indian exporters. Most exporters convert foreign earnings into rupees soon after they arrive; the account would let them hold dollars or euros, pay overseas suppliers from that balance, or convert when they choose, subject to the rules. Skydo also plans merchant acquiring and collections, plus settlement services for platforms that sell US stocks and for export finance providers. The company says it processes more than $1 billion a year in payments and already holds RBI authorisation as a cross-border payment aggregator for export collections and outward payments.
The approval came in the same week IFSCA set financial soundness rules for payment system operators in GIFT City. Its October 27 circular requires TReDS operators to hold a net worth of at least $1 million and LEI issuers $200,000, with six months for existing operators to comply. Fintech PSPs such as Skydo fall under separate 2024 regulations, which set an initial net worth of $100,000.
Why it matters: An account that holds foreign currency lets small exporters choose when to convert, which can save them repeated conversion costs on each payment. Skydo joins INDmoney, Vested and XFlow among fintech PSPs in GIFT City, and its plans for US stock platforms and trade finance would take it beyond export collections into outward investment flows. The test is whether these accounts become cheap and simple enough for small firms that rely on bank wires today.
Source: ETBFSI; Elets BFSI; The Hindu BusinessLine (IFSCA norms)
Image: Pooja T S, CC BY-SA 4.0, via Wikimedia Commons
