The Reserve Bank of India (RBI) has granted Authorised Dealer Category II (AD II) licences to Niyo Forex, which operates through Kanji Forex Pvt Ltd, and GlobalPay, the brand name of WSFx Global Pay Ltd. Niyo Forex received a perpetual licence, while GlobalPay secured an expanded perpetual licence under the updated Foreign Exchange Management Act (FEMA) 2026 framework. These licences allow both companies to facilitate inward and outward trade remittances up to a limit of ₹25 lakh.
What Is an Authorised Dealer?
An Authorised Dealer (AD) is a person or institution that the RBI permits to deal in foreign exchange and foreign securities. The legal basis for this lies in Section 10(1) of the Foreign Exchange Management Act (FEMA), 1999, which empowers the RBI to authorise any person to conduct foreign exchange business. Under Section 2(c) of FEMA, an authorised person includes an authorised dealer, a money changer, an offshore banking unit, or any other person authorised under the Act.
The RBI has divided authorised dealers into three categories based on the scope of activities they may perform:
| Category | Who Can Hold It | Activities Permitted |
|---|---|---|
| AD Category I | Banks licensed by the RBI | All current and capital account transactions permitted under FEMA |
| AD Category II | NBFCs, upgraded Full-Fledged Money Changers (FFMCs), select banks | Specified non-trade current account transactions and foreign trade transactions up to ₹25 lakh per transaction |
| AD Category III | Entities that deal in foreign exchange incidental to their main business | Only the activities mentioned in the authorisation issued by the RBI |
Under Section 10(1), the RBI authorises these entities to deal in foreign exchange. The RBI also issues directions under Section 10 to ensure that all such transactions comply with the Act, including proper documentation and record-keeping.
FEMA 2026: A New Framework for Forex
The RBI notified the Foreign Exchange Management (Authorised Persons) Regulations, 2026 on 30 April 2026 through Notification No. FEMA 401/2026-RB. The regulations came into effect on 6 May 2026, when they were published in the Official Gazette. This is the most significant overhaul of the forex licensing framework in recent years and is commonly referred to as FEMA 2026.
The Foreign Exchange Management Act (FEMA), 1999 replaced the earlier Foreign Exchange Regulation Act (FERA), 1973, and shifted India’s forex regime from strict control to management. FEMA classifies all foreign exchange transactions into current account transactions and capital account transactions. A current account transaction covers payments for trade, services, interest, travel, education, and family maintenance, while a capital account transaction alters the assets or liabilities of a person resident in India outside India.
FEMA 2026 introduces several major changes to this framework:
- No fresh FFMC licences: The RBI will not consider new applications for Full-Fledged Money Changer (FFMC) licences, except those already under process. An FFMC is a money changer authorised to buy and sell foreign currency notes and travellers’ cheques.
- Minimum net worth: AD Category II entities must maintain a minimum net worth of ₹10 crore, while AD Category III entities need ₹2 crore.
- Minimum turnover: Non-bank AD Category II entities must achieve a minimum annual forex turnover of ₹50 crore within two years.
- Online applications: Fresh authorisation applications must be submitted through the PRAVAAH portal of the RBI.
What AD-II Entities Can Now Do
Under the new regulations, AD Category II entities have been given a significantly wider operational mandate. They can now undertake:
- All permissible non-trade current account transactions, except gifts and donations
- Foreign trade transactions of up to ₹25 lakh per transaction
- Maintenance remittances for family members, dependants, and properties abroad
This expansion is significant because non-trade current account transactions include personal remittances, education fees, travel expenses, and maintenance payments. The inclusion of foreign trade transactions is a major step, as trade remittances were historically handled almost exclusively by banks. Small exporters and importers, including the MSME sector, can now use non-bank AD II entities for their commercial forex needs.
Analogy · Bank vs AD-II Entity Expand analogy
Think of AD Category I banks as full-service post offices that can handle every kind of mail, and AD Category II entities as specialised courier companies that can now handle an expanded set of parcels. Under the new rules, these couriers can accept trade parcels worth up to ₹25 lakh, which was earlier reserved only for the post offices.
Forex Correspondent Scheme
FEMA 2026 also introduces the Forex Correspondent (FxC) Scheme, which replaces the older franchisee model. AD Category I and AD Category II entities can now appoint Forex Correspondents as agents under a formal principal-agent structure.
The scheme is modelled on the Business Correspondent model used in banking to extend financial services to villages and small towns. In the same way, Forex Correspondents will help licensed forex entities extend regulated services to tier-2 and tier-3 cities without opening branches everywhere. Existing franchisee arrangements must be wound down within two years, after which franchisees can operate only as Forex Correspondents.
Niyo Forex: Perpetual Licence via Kanji Forex
Niyo Forex is the foreign exchange arm of Niyo, a Bengaluru-based travel fintech platform. Niyo was founded in 2015 by Vinay Bagri and Virender Bisht, and it pioneered zero-markup forex debit and credit cards for Indian travellers. Its parent company is Finnew Solutions Pvt Ltd.
Niyo entered the offline forex business in 2025 by acquiring Kanji Forex Pvt Ltd, a Mumbai-based company founded in 1935 as Kanji Pitamber & Co. Kanji Forex is among the oldest players in India’s forex industry and has served both Indian and international banks with foreign currency solutions for decades. After the acquisition, the combined entity operates as Niyo Forex (Powered by Kanji Forex Pvt Ltd).
The perpetual AD II licence granted to Niyo Forex provides long-term regulatory continuity for its forex business. It enables the company to undertake an expanded set of permitted AD II activities, including trade remittances and family maintenance remittances. The licence also allows Niyo Forex to expand its branch network without seeking fresh RBI approvals for each new branch.
Niyo Forex offers foreign currency cash, forex cards, and outward remittances to Indian travellers. The company’s CEO, Amit Talwar, said the perpetual licence is an important milestone and reflects the regulator’s confidence in the company’s compliance framework and operations.
GlobalPay: Expanded Perpetual Licence
GlobalPay is the brand name of WSFx Global Pay Ltd, a Mumbai-based foreign exchange company listed on the Bombay Stock Exchange (BSE). The company was incorporated in 1986 as Wall Street Finance Limited and became the first listed company in India to obtain an FFMC (Full-Fledged Money Changer) licence in 1991. It changed its name to WSFx Global Pay Limited in 2022 and is part of the Spice Connect group.
GlobalPay received an expanded perpetual AD II licence under FEMA 2026 (Notification No. FEMA 401/2026). The expansion means the company can now:
- Undertake all eligible non-trade current account transactions, except gifts and donations
- Facilitate inward and outward trade remittances of up to ₹25 lakh
- Appoint Forex Correspondent Agencies to widen the reach of regulated forex services across the country
The company serves individuals, students, travellers, exporters, importers, corporates, and financial institutions. GlobalPay’s CEO and Whole-Time Director, Srikrishna Narasimhan, said the enhanced authorisation will help the company meet the growing demand for seamless and compliant forex and remittance solutions. The company operates more than 25 branches, serves over 850 corporate clients, and has over 650 agents.
Why These Licences Matter
These licences reflect the wider transformation underway in India’s forex ecosystem under FEMA 2026. For individuals, the move means more regulated, non-bank options for sending money abroad. Students paying overseas tuition, travellers, and families supporting relatives abroad now have more choices beyond the bank counter.
For businesses, the entry of AD II entities into trade remittances up to ₹25 lakh is particularly important. Small and medium exporters and importers, who previously had to route all trade payments through banks, can now use regulated non-bank forex platforms. This directly benefits the MSME sector, which contributes substantially to India’s trade.
The licences also signal growing regulatory confidence in fintech companies. Both Niyo Forex and GlobalPay have built technology-driven platforms, and the perpetual nature of their licences means they do not need periodic renewals. The Forex Correspondent Scheme will further help these companies extend regulated forex services to tier-2 and tier-3 cities, improving access for people who currently rely on informal channels.
India’s remittance economy is large and growing. Millions of Indians travel, study, and work abroad every year, and India’s outbound tourism market alone is projected to be worth around $60 billion by 2031. The RBI’s 2026 reforms appear designed to make the forex ecosystem broader in reach, tighter in compliance, and more digital in operation.
The shift away from the standalone FFMC model is also worth noting. As existing FFMC licences expire, the market is consolidating around a smaller number of stronger, well-regulated entities with wider scope. This is expected to bring better services and more competition in the long run.
Key Takeaways
- The Reserve Bank of India (RBI) granted Authorised Dealer Category II (AD II) licences to Niyo Forex (via Kanji Forex Pvt Ltd) and GlobalPay (WSFx Global Pay Ltd) under FEMA 2026.
- The licences allow both entities to facilitate inward and outward trade remittances up to ₹25 lakh per transaction.
- An Authorised Dealer is an entity authorised under Section 10(1) of FEMA, 1999 to deal in foreign exchange and foreign securities.
- The Foreign Exchange Management (Authorised Persons) Regulations, 2026 were notified on 30 April 2026 via Notification No. FEMA 401/2026-RB and took effect on 6 May 2026.
- Under FEMA 2026, AD Category II entities must maintain a minimum net worth of ₹10 crore, while new FFMC licences will no longer be issued.
- FEMA, 1999 replaced the Foreign Exchange Regulation Act (FERA), 1973, shifting India’s forex regime from control to management.
