Fintech platform Niyo has secured a Payment Service Provider (PSP) licence from the International Financial Services Centres Authority (IFSCA) to operate from GIFT City in Gandhinagar, Gujarat. The approval was announced on 8 September 2026 and will allow Niyo to build international financial products from inside India’s offshore financial centre. The company plans to move beyond travel forex into education, overseas jobs, spending and money transfers.
What Is a Payment Service Provider Licence?
A Payment Service Provider, or PSP, is a company authorised to move money for customers and merchants. In GIFT City, a PSP licence is permission from IFSCA under the IFSCA (Payment Services) Regulations, 2024. It allows the holder to offer account issuance, e-money, escrow and cross border money transfer services.
The licence is different from a bank licence. A bank can accept deposits and lend money. A PSP cannot do general banking. It can only provide the specific payment services approved by IFSCA. To get the licence, the company must be incorporated with its registered office inside the IFSC, meet minimum net worth norms and show that its directors and key managers are fit and proper.
IFSCA recognises two types of providers. A Regular PSP starts with a net worth of $100,000 on the date it begins operations, which must rise to $200,000 by the end of the third financial year. A Significant PSP, which handles larger volumes, starts at $250,000 and must reach $500,000 in the same period. A Regular PSP becomes Significant if its monthly average transactions cross $2 million for one service or $4 million for multiple services in a year.
| Payment Service | What It Means in Simple Terms |
|---|---|
| Account issuance service | Opening and operating a payment account for a user |
| E-money issuance service | Issuing stored digital money that can be used to pay |
| Escrow service | Holding money safely with a banking unit until a deal is complete |
| Cross border money transfer service | Sending money from IFSC to outside, or receiving money from outside |
| Merchant acquisition service | Processing card or digital payments for shops and businesses, and paying the merchant |
What Is IFSCA?
The International Financial Services Centres Authority, or IFSCA, is the unified regulator for all financial business inside India’s International Financial Services Centres. It was set up on 27 April 2020 under the IFSCA Act, 2019. It is headquartered at GIFT City in Gandhinagar, Gujarat.
Before IFSCA was formed, four different regulators handled business in the IFSC. The Reserve Bank of India (RBI) looked after banking, the Securities and Exchange Board of India (SEBI) handled securities, the Insurance Regulatory and Development Authority of India (IRDAI) handled insurance, and the Pension Fund Regulatory and Development Authority (PFRDA) handled pensions. Parliament created IFSCA to bring all these powers under one roof for the IFSC. This single window system was meant to make it easier to do business and to offer rules that match global standards.
IFSCA develops and regulates banks, insurers, capital market firms, fund managers, fintech companies and payment providers that operate from the IFSC. At present, GIFT IFSC is the only operational IFSC in India. IFSCA also holds powers of the Development Commissioner under the Special Economic Zones Act, 2005, and runs a Single Window IT System (SWITS) for fast approvals to new units.
Where Is GIFT City?
GIFT City stands for Gujarat International Finance Tec-City. It is located between Ahmedabad and Gandhinagar in Gujarat, on the banks of the Sabarmati River. It hosts India’s first and only International Financial Services Centre, which operates as a multi-services Special Economic Zone.
The city is developed as a greenfield smart city over 886 acres, with plans to expand to more than 3,300 acres. It has two parts. The Domestic Tariff Area (DTA) serves domestic business, while the GIFT SEZ, spread over about 261 acres, houses the IFSC and works under offshore rules within India. The IFSC was notified under the Special Economic Zones Act, 2005, which gives it a distinct legal and tax framework.
GIFT City is not fully tax free, but it offers a competitive tax system. Units in the IFSC get a tax holiday, lower withholding tax on certain debt payments, no Goods and Services Tax on transactions inside the IFSC, and customs duty exemption on goods brought into the SEZ. The centre already hosts foreign and domestic banks, insurers, fund managers, aircraft and ship leasing firms, bullion exchange, universities and a growing fintech hub with more than 700 businesses operating from the city.
What Will Niyo Do From GIFT City?
The PSP licence will allow Niyo to design and offer international financial products from GIFT City under IFSCA oversight. The company has said it will use the base to expand beyond its current travel forex business. The new focus areas include international education payments, overseas employment related transactions, global spending and cross border money movement.
This shift reflects a change in customer needs. Indian families now spend steadily on foreign university fees, living costs for students, work related relocation, overseas shopping and support to relatives abroad. Niyo’s Chief Business Officer for forex has noted that the globalising Indian customer is no longer defined by travel alone. The GIFT City platform will help the company build services for these regular needs, working with banking partners as required under IFSCA rules.
In practical terms, the PSP framework lets a company offer tools such as multi-currency accounts, international collections and payouts, escrow for high value deals and settlement of cross border transactions. Niyo has not yet published its full product list for GIFT City. Its GIFT City unit is expected to combine app based services with its growing branch network, so customers can use both digital and in person channels.
Who Is Niyo and How Does Its Forex Business Work?
A Niyo card is a debit or credit card that lets Indians spend abroad with zero forex markup. Users load rupees and pay in more than 180 countries at the Visa exchange rate. The cards are issued by partner banks such as DCB Bank and SBM Bank (India).
Niyo is a Bengaluru based fintech platform founded in 2015 by Vinay Bagri and Virender Bisht. It is operated by Finnew Solutions Private Limited. Niyo itself is not a bank and does not hold a banking licence. It provides technology and customer services, while savings accounts, deposits and co-branded cards are issued by its partner banks and insured under applicable deposit insurance limits.
The company started with salary accounts and then built its name around the Niyo Global Card and Niyo Forex Card. Most Indian banks add a currency conversion fee of up to 5 percent on overseas spends. Niyo’s zero markup model removes this fee, which helps travellers, students and professionals save on card swipes, online payments and ATM withdrawals abroad. The platform now also offers visas, flights, insurance, hotels and eSIM support for travellers, and claims more than 2 million users.
Niyo entered regulated forex in 2024 by acquiring Kanji Forex Private Limited, an Authorised Dealer Category II (AD II) entity licensed by the RBI. Kanji Forex, which dates back to 1998, can handle foreign exchange and outward remittances under the Foreign Exchange Management Act (FEMA). In August 2026, Niyo received a perpetual AD II licence with wider scope. On 1 September 2026, it agreed to acquire the RemitX forex business of Capital India Finance for ₹11.4 crore. RemitX brings 32 branches across 16 states and more than 30 cities, over 2,500 distribution partners and more than 200 employees. After the deal, Niyo’s physical network will cross 40 locations, moving toward its stated goal of 50 branches in two to three years.
| Niyo Offering | How It Works |
|---|---|
| Niyo Global debit card with DCB Bank | Rupee account loaded through UPI, spent abroad in over 130 currencies at zero markup |
| Niyo secured credit card with SBM Bank (India) | Fixed deposit backed limit that can be raised on the go for hotels and rentals |
| Niyo Forex through Kanji Forex | Forex cards, foreign currency cash with doorstep delivery, and outward remittances with documentation support |
Why This Licence Matters for Cross Border Payments
India’s overseas spending has grown well beyond tourism. Families pay university fees, professionals move for jobs, and firms pay foreign vendors and collect export income. India’s outward remittances under the Liberalised Remittance Scheme (LRS) stood at $31.73 billion in 2023-24, with travel and education among the fastest growing parts. Niyo estimates India’s outbound forex market at more than $45 billion. A GIFT City base lets the company serve this demand from a centre built for foreign currency business, with access to banking units, global partnerships and dollar based settlement.
The licence also shows how GIFT City is becoming a fintech hub. Dozens of fintech firms now operate from the IFSC, and recent PSP approvals allow them to offer merchant onboarding, virtual multi-currency accounts, cross border transfers and escrow services under one regulator. For Niyo, operating under IFSCA means a single rulebook for international products, instead of separate domestic permissions for each activity. For customers, it can mean faster onboarding, clearer compliance for Anti Money Laundering and Know Your Customer checks, and simpler movement of money between payment accounts and investment products where rules permit.
The table below clears two common confusions around this news.
| Comparison | Simple Difference |
|---|---|
| IFSCA and RBI | RBI regulates finance in domestic India, while IFSCA regulates finance only inside the IFSC at GIFT City with powers drawn from RBI, SEBI, IRDAI and PFRDA |
| Payment service provider and payment aggregator | A payment aggregator collects domestic online payments for merchants under RBI rules, while a GIFT City PSP provides offshore and cross border payment services under IFSCA rules |
Key Takeaways
- Niyo secured a Payment Service Provider licence from IFSCA on 8 September 2026 to operate from GIFT City, Gandhinagar.
- GIFT City stands for Gujarat International Finance Tec-City and hosts India’s only International Financial Services Centre as a multi-services Special Economic Zone.
- IFSCA was established on 27 April 2020 under the IFSCA Act, 2019 as a unified regulator with powers of RBI, SEBI, IRDAI and PFRDA for the IFSC.
- Niyo, founded in 2015 in Bengaluru and operated by Finnew Solutions, offers zero forex markup cards issued by DCB Bank and SBM Bank (India).
- Niyo agreed to acquire the RemitX forex business of Capital India Finance for ₹11.4 crore, adding 32 branches and over 2,500 partners.
- GIFT City PSP licences are governed by the IFSCA (Payment Services) Regulations, 2024 and cover account issuance, e-money, escrow and cross border transfers.
