At the Global Fintech Fest 2025, a high-impact panel discussion titled ‘The Convergence of Payments and FX: India’s Next Fintech Opportunity’ convened leaders from banking, forex, and digital payments.
Participants included Hare Krishna Jena of the Clearing Corporation of India (CCIL), Neeraj Gambhir of Axis Bank, Santosh Dujari of CITI, and Amit Talwar of Niyo Forex, moderated by Shweta Dasgupta from NPCI Bharat BillPay Limited.
The discussion explored how India’s mature digital payments ecosystem is now poised to integrate foreign exchange services, enabling seamless, real-time cross-border experiences for consumers and businesses.
The panelists emphasized that foreign exchange is no longer a siloed treasury function; it is increasingly becoming a core layer within digital payments. From remittances to travel spending and cross-border e-commerce, users now expect instantaneous FX conversion, transparency, and predictable costs.
Neeraj Gambhir of Axis Bank highlighted the shift, stating, “We’re seeing demand for FX embedded in everyday transactions—like paying for a course abroad or shopping on global platforms. The infrastructure must evolve to support this.”
He stressed that consumers want FX as a natural, almost invisible part of their payment journey, rather than a separate, cumbersome process.
Fintrade Securities Corporation Ltd (FSCL) views this trend as transformational. “FX is evolving from a niche banking function into a feature embedded in daily financial interactions. Integrating FX into apps, wallets, and payment platforms will fundamentally reshape India’s fintech landscape,” an analyst from the global investment and financial advisory services firm.
The firm recommends that fintechs focus on contextual FX, linking it directly to use cases such as travel, education, freelancing, and cross-border e-commerce, rather than offering FX as a standalone product.
REGULATORY EVOLUTION AND OVERSIGHT
The panel also highlighted India’s progressive regulatory environment. Santosh Dujari of CITI emphasized RBI’s initiatives to facilitate retail FX innovation, including the sandbox for testing new FX products and the introduction of the Foreign Currency Settlement System.
“The challenge,” she observed, “is balancing innovation with compliance, particularly in areas such as anti-money laundering, KYC, and capital controls.”
Fintrade Securities recommends that regulators expand sandbox frameworks to include emerging FX instruments, such as stablecoin-linked FX, programmable FX contracts, and digital cross-border payment solutions.
“India’s regulatory foresight can set a global benchmark. Harmonizing FX norms with international standards like ISO 20022 and SWIFT GPI will enhance interoperability while maintaining compliance,” a spokesperson from Fintrade Securities remarked.
Fintech Innovation and Consumer-Facing FX
Amit Talwar of Niyo Forex showcased how fintechs are creating user-friendly FX products, including multi-currency cards, travel wallets, and real-time rate alerts. He stressed the importance of interoperability between banks, fintechs, and global payment networks.
“We’re moving toward a world where your UPI app can also show FX rates and let you pay directly in Dirhams or Euros,” he noted, highlighting the expectation for seamless, real-time FX integration.
FSCL sees embedded FX as a catalyst for financial inclusion and efficiency. It observed, “The integration of FX into consumer apps, wallets, and BNPL platforms allows everyday users to access international financial services effortlessly. Startups that build APIs for real-time FX conversion and settlement can become strategic enablers for both retail and business users.”
Infrastructure and Clearing Requirements
Hare Krishna Jena of CCIL discussed the necessary backend infrastructure to support FX convergence, including clearing, settlement, and risk management systems.
He advocated for a unified FX switch to connect banks, fintechs, and regulators, ensuring transparency, efficiency, and risk mitigation in real time.
Fintrade Securities concurs, emphasizing that robust infrastructure is central to scaling FX convergence. “A real-time clearing and settlement engine, backed by risk management protocols and integrated dashboards for regulators, is essential. This infrastructure will reduce costs, improve transparency, and accelerate settlements,” the firm noted.
STRATEGIC IMPORTANCE OF FX CONVERGENCE
India is the world’s largest recipient of remittances and a growing hub for cross-border e-commerce. However, FX services remain fragmented, costly, and opaque. Integrating FX with digital payments can significantly reduce costs, enhance transparency, accelerate settlement, and expand financial access for non-resident Indians, freelancers, small businesses, and travellers.
This convergence also aligns with India’s broader strategic goals of financial sovereignty, digital trade facilitation, and international competitiveness.
Fintrade Securities offers, “By embedding FX into India’s digital rails, the country can strengthen its position as a global payment hub, improve cost efficiency for end users, and enhance transparency in cross-border flows. This is not just fintech evolution—it is national economic strategy.”
Investment Outlook and Emerging Opportunities
From an investor perspective, FX convergence opens new verticals across fintech, including FX analytics, travel fintech, remittance technologies, cross-border BNPL, and AI-powered rate prediction.
Fintrade Securities is monitoring startups that offer real-time hedging, dynamic FX credit products, and integrated payment-FX experiences, predicting increased venture capital interest in FX-as-a-service and embedded finance platforms.
“Investors are drawn to fintech solutions that combine operational scale, consumer convenience, and regulatory compliance. Embedded FX meets all three criteria,” said a Fintrade Securities strategist.
GLOBAL IMPLICATIONS AND REPLICABILITY
India’s FX convergence model holds global relevance. Countries in Africa, Southeast Asia, and Latin America face similar challenges: high remittance costs, fragmented FX markets, and limited transparency.
India’s approach of integrating FX into digital payments, backed by robust infrastructure and regulatory foresight, provides a replicable blueprint for these markets.
Despite the promise, FX convergence faces challenges. Effective liquidity management is critical to ensure real-time currency availability. Cybersecurity is a major concern as FX flows become more digital and consumer-facing.
Merchant adoption requires education and support to effectively use FX tools. Interoperability between banks, fintechs, and global payment networks must be robust and seamless.
Fintrade Securities recommends the establishment of a national FX innovation fund to support startups, infrastructure modernization, and regulatory research.
The fund could also provide incentives for fintechs developing real-time settlement engines, cross-border APIs, and consumer transparency platforms. “A coordinated, multi-stakeholder approach will accelerate adoption while maintaining systemic security and trust,” Fintrade Securities advised.
A Borderless Financial Future
The convergence of payments and FX marks a defining moment in India’s fintech evolution. It combines technological innovation, regulatory foresight, and consumer-centric design to create a truly borderless financial ecosystem.
By embedding FX seamlessly into digital payment experiences, India not only enhances convenience and efficiency for users but also positions itself as a global hub for integrated financial services.
Fintrade Securities Corporation Ltd emphasizes that this is both a technological and strategic opportunity. It observed, “India is demonstrating how payments and FX can converge to create real-time, transparent, and inclusive financial experiences. The ecosystem we are building today will define cross-border commerce and fintech innovation for years to come.”
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