Decentro has secured final approval from the International Financial Services Centres Authority (IFSCA) to operate as a Payment Service Provider (PSP) within GIFT City in Gandhinagar, Gujarat. This milestone makes the fintech company the first Indian payment aggregator to receive authorization under this regulatory framework. The approval allows Decentro to offer unified cross-border and multi-currency financial services, addressing critical friction points in international transactions.
Decentro Becomes First Indian Payment Aggregator to Secure IFSCA PSP Licence
The final approval granted by the regulatory authority enables Decentro to expand its scope beyond domestic payment processing to international financial corridors. Founded in 2020 by Rohit Taneja and Pratik Daudkhane, the company operates as a full-stack Banking-as-a-Service (BaaS) and Application Programming Interface (API) banking platform. It serves as an infrastructure layer, enabling businesses to integrate financial services like payments, identity verification, and ledger management into their applications.
By establishing a dedicated business unit in the International Financial Services Centre (IFSC) at GIFT City, Decentro joins the offshore financial ecosystem. The PSP licence allows the company to process, settle, and facilitate transactions involving foreign currencies, positioning it to capture a share of the expanding global cross-border payments market.
The Four Core Payment Services under the PSP Framework
Under the PSP framework governed by the IFSCA, Decentro plans to introduce a suite of four key services. These services aim to streamline international payments, reduce currency management friction, and improve compliance for businesses.
| Payment Service | Description and Key Functionalities |
|---|---|
| Merchant Acquisition | Enables foreign enterprises to onboard and collect payments from Indian clients, while helping domestic businesses accept international payments smoothly. |
| Virtual Account Issuance | Allows companies to set up multi-currency virtual accounts, simplifying the consolidation, reconciliation, and settlement of international transactions. |
| Cross-Border Money Transfers | Facilitates swift and regulated international funds transfers to overseas vendors, service providers, and global partners. |
| Escrow Services | Provides secure, institutional-grade escrow mechanisms for international trade, protecting transacting parties by holding funds until contractual terms are met. |
By bundling these services, the platform eliminates the need for businesses to coordinate with multiple distinct intermediaries, bringing efficiency and security to global money movement.
Gujarat International Finance Tec-City: India’s IFSC Hub
Gujarat International Finance Tec-City (GIFT City), situated in Gandhinagar, Gujarat, represents India’s premier operational smart city and hosting site for the nation’s first International Financial Services Centre (IFSC). Established to compete with global financial hubs like Singapore, London, and Dubai, GIFT City acts as a gateway for international capital and financial services.
Under Indian regulatory frameworks, the IFSC within GIFT City is treated as a foreign territory for financial and tax purposes. This unique designation allows businesses registered in the zone to transact in foreign currencies, exempts them from standard domestic currency controls, and offers significant tax benefits, such as a ten-year tax holiday. By setting up operations in GIFT City, domestic fintech platforms can interact directly with international financial markets under a specialized regulatory structure.
Unified Financial Regulation: The Role of the IFSCA
The International Financial Services Centres Authority (IFSCA) is the unified statutory regulator tasked with overseeing the development, administration, and regulation of financial products, services, and institutions within India’s IFSCs. Officially established on April 27, 2020, under the International Financial Services Centres Authority Act, 2019, the authority operates from its headquarters inside GIFT City.
Prior to the creation of the IFSCA, regulatory oversight within the IFSC was fragmented. Multiple domestic financial regulators, including the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI), and the Pension Fund Regulatory and Development Authority (PFRDA), governed respective segments within the zone. The IFSCA was established to consolidate these regulatory powers, creating a single-window system. This unified approach simplifies compliance, shortens approval timelines, and promotes a highly responsive regulatory environment tailored to the dynamics of international finance.
Strategic Significance of the PSP Licence for Cross-Border Fintech
The granting of the PSP licence to Decentro carries significant strategic importance for the Indian fintech sector. Cross-border business-to-business payments have historically been slow, expensive, and complex, involving multiple intermediary banks and strict compliance reporting. By utilizing the regulatory landscape of the IFSC, Decentro can offer global businesses a direct routing mechanism, reducing settlement times and operational expenses.
This approval highlights the growing integration between domestic fintech platforms and global markets. It enables global companies to enter the Indian market with simpler collection mechanisms. Simultaneously, it allows Indian enterprises to expand their international reach by using secure, unified API services. As the first Indian payment aggregator to obtain this licence, Decentro sets a regulatory precedent, showing how digital payment infrastructure can be extended to international borders.
Key Takeaways
- Decentro became the first Indian payment aggregator to receive final approval from the International Financial Services Centres Authority (IFSCA) to operate as a Payment Service Provider (PSP) in GIFT City, Gandhinagar.
- Decentro, founded in 2020 by Rohit Taneja and Pratik Daudkhane, is an API banking and Banking-as-a-Service (BaaS) infrastructure provider.
- The company plans to launch four services under the PSP framework, which include merchant acquisition, virtual account issuance, cross-border money transfers, and escrow services.
- The IFSCA was officially established on April 27, 2020, under the International Financial Services Centres Authority Act, 2019, to serve as the unified financial regulator for IFSCs in India.
- The creation of the IFSCA consolidated regulatory powers previously distributed across the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), the IRDAI, and the PFRDA.
