Workforce Payments Guide India

Last updated: Dec 26, 2023

Indian Rupee (INR)
Payroll Frequency
New Delhi
Fiscal Year
1 April - 31 March
Employer Taxes
Employee Costs
Central Bank
Reserve Bank of India
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3rd Party Payments

Authority  Payment Frequency  Due Date  Payment Method 
Corporate Income Tax (CIT)  Quarterly  15 June, 15 September, 15 December, 15 March  Digital 
Withholding Tax  Various  Various  Digital 

Payments Coverage

Papaya Global fully supports payroll payments in India.

Contractor Payments

Papaya Global supports payments to contractors in India. The payout currency may vary based on the receiver bank account setup when receiving foreign currencies. it is advised for contractors to reach out to their bank to confirm how foreign currencies are handled

Payroll Frequency



In India, the Know Your Customer (KYC) process is a verification process mandated by the Reserve Bank of India (RBI) to confirm and verify the authenticity of customers. It is required for individuals initiating their first investment or opening a bank account and serves to authenticate the individual’s address and identity, preventing banks from being used for money laundering activities.

Two modes of KYC verification exist: physical and video. Physical KYC verification involves the client gathering necessary documents such as proof of identity and address, and passport-size photographs. They then visit the bank branch, fill out a KYC application form, and submit the required documents for verification. The bank subsequently undertakes a verification process based on the documents submitted and information provided.

Video KYC allows the customers to complete their KYC through a video call where they submit details such as PAN Card and a signature. The video KYC system uses AI-backed facial pattern recognition features to match the customer with their photo available on the Aadhaar site.

The KYC process is managed through the Central KYC (CKYC) system, an initiative by the Indian government. This system is governed by the Central Registry of Securitisation Asset Reconstruction and Security Interest (CERSAI). The documents submitted for KYC are sent to CERSAI, which then assigns a unique 14-digit CKYC number to the individual.

In future transactions, the individual is not required to submit the documents again; the institution can simply request the documents from CERSAI using the CKYC number.

The KYC process also involves periodic updating of KYC or re-KYC. If there is no change in KYC information, a self-declaration from the individual customer is sufficient for the re-KYC process. In certain cases where the available KYC documents do not conform to the present list of officially valid documents or where the validity of the submitted KYC document has expired, a fresh KYC process may be required.

All financial institutions are mandated by the RBI to do the KYC process for all customers before giving them the right to carry out any financial transactions. This one-time process can be done online or offline. All KYC checks the legal status of the entity, verifies the operating addresses and identities of their beneficial owners and authorized signatories, and requires information about the nature of employment and the business carried out by the customer.

Banking Regulations

Country-specific banking laws and regulations that impact cross-border workforce payments.

In India, banking regulations that impact cross-border workforce payments include:

1. The Payment Aggregators of Cross Border Transactions (PA-CB Regulation) issued by the Reserve Bank of India (RBI), which governs entities engaged in the processing/settlement of cross-border payment transactions for import and export of goods and services.

The PA-CB Regulation distinguishes service providers into: Export only PA-CB (PA-CB-E); Import only PA-CB (PA-CB-I); and Export and Import PA-CB (PA-CB-E&I), with specific conditions for each type of services provided.

2. Compulsory registration with the Financial Intelligence Unit – India (FIU-IND) for entities facilitating cross-border transactions to curb illegal activities.

3. Revised Tax Collected at Source (TCS) rates were introduced for sending money overseas through the Liberalised Remittance Scheme (LRS), which the PA-CB Regulation helps monitor.

4. The PA-CB Regulation also imposes heavy compliance requirements on non-bank entities offering PA-CB services, which includes maintaining a certain net worth, conducting customer due diligence for merchants directly onboarded by it, and ensuring no payment for the import or export of prohibited/restricted goods and services under the prevailing foreign trade policy.

5. The use of channels like SWIFT, RDA, and MTSS for transferring funds across borders. The SWIFT network facilitates international transactions through bank transfers. The RDA is a channel through which Indians can receive remittances from selected countries across the world. MTSS is a service that allows Indian residents to receive personal remittances from abroad.

6. Cross-border transactions are also subjected to regulatory requirements from the country of origin, the destination country, and any other jurisdiction a transaction might need to pass through. RBI’s regulations and guidelines like AML, KYC, limits, etc., as well as other legislations like SEPA system and PSD2 in Europe, must be adhered to.

7. Banks have specific regulatory and compliance requirements for AML and KYC, which may increase the cost for setting up the process.

8. The introduction of ISO 20022 is a step towards mitigating the problem of interoperability, with many countries adopting or planning to adopt these messaging standards.

9. Non-bank entities and AD Banks providing PA – CB services must inform the DPSS about their existing cross-border payment facilitation activities.

10. Domestic payment aggregators are allowed to engage in cross-border payment facilitation activities by obtaining registration as a PA – CB.

11. Increased compliance requirements for existing PA – CBs, including adoption of baseline technology requirements, implementation of robust fraud prevention and risk management frameworks, data localization requirements, etc.

12. The regulatory framework mandates licensing of entities as PA – CBs, and imposes significant compliance burden on them, including the need to implement robust merchant onboarding, customer grievance redressal, anti-money laundering, and information security protocols.

Opening a Bank Account

To open a company bank account in India, the following requirements must be met:

1. Certificate of Incorporation

2. Memorandum of Association (MOA) and Articles of Association (AOA)

3. Resolution of the company’s board of directors for opening a corporate bank account

4. Power of attorney, stating the persons who can act in the name of the company for this procedure

5. A copy of the Permanent Account Number (PAN) in the name of the company

6. Information on the principal place of business, mailing address of the company, and telephone number

7. A copy of the telephone bills

8. In case of a public limited company, a certificate of commencement of business is required

For a sole proprietorship, the company’s founder must provide a statement issued by the bank where his or her individual/savings current account is set up. For a limited liability partnership, the investors will also need to offer the list of the company’s representatives who own more than 25% of the company’s shares, in addition to the above-mentioned documents.

The process of opening a bank account in India can take from 10 working days up to two months.

International Banks

The major foreign banks operating in India include:


2. AB Bank Limited

3. Bank of Bahrain and Kuwait

4. Bank of America

5. Citi Bank

6. Standard Chartered Bank

7. Deutsche Bank

8. Sumitomo Mitsui Banking Corporation

9. DBS Bank

10. The Royal Bank of Scotland

11. J.P. Morgan Chase

12. Doha Bank

13. BNP Paribas

14. Barclays Bank

15. State Bank of Mauritius (SBM Bank)

16. American Express Banking Corporation

Major Local Banks

The major local banks operating in India include:

Public Sector Banks:

1. Bank of Baroda

2. Bank of India

3. Bank of Maharashtra

4. Canara Bank

5. Central Bank of India

6. Indian Bank

7. Indian Overseas Bank

8. Punjab and Sind Bank

9. Punjab National Bank

10. State Bank of India

11. UCO Bank

12. Union Bank of India


Private Sector Banks:

1. Axis Bank

2. Bandhan Bank

3. CSB Bank

4. City Union Bank

5. DCB Bank

6. Dhanlaxmi Bank

7. Federal Bank

8. HDFC Bank

9. ICICI Bank

10. IndusInd Bank

Payment Tools

The B2C payment tools available in India include:

  • Bharat QR
  • PayTM
  • Swipez Billing Software
  • Instamojo
  • Google Pay
  • MSwipe
  • Flipkart’s cash-on-delivery and simple refund services
  • Amazon India’s Prime membership program
  • Swiggy’s real-time order tracking and the capacity to modify orders
  • Zomato’s real-time order tracking, individualized recommendations, and simple payment alternatives along with its loyalty program called Zomato Gold

Other tools include:

  • PayPal India
  • PayU
  • PhonePe
  • CCAvenue
  • Razorpay
  • Cashfree
  • EBS
  • Cashfree Payments
  • PayKun
  • Indicpay’s B2C payment gateway, and traditional payment methods like credit and debit card


In India, it is possible to pay employees with cryptocurrencies such as bitcoin, ether, and tether (USDT). However, the government does not consider cryptocurrency as legal tender. If an employer provides cryptocurrency as part of an employee’s salary or as payment for goods or services, it is considered a taxable perquisite.

The value of the cryptocurrency at the time of receipt is treated as income for the employee and taxed accordingly. There is no provision in the law that says income is taxable only when you bring it in the form of INR. If you choose to retain the cryptocurrency, you should book it as income and show the money as an investment. However, it is crucial to ensure that the correct tax amounts are paid.

While cryptocurrencies are used as a means of remuneration, especially by gig workers, it is recommended to convert these digital tokens to fiat using a crypto exchange, then raise invoices in the name of their clients, showing the rupee amounts. Until the government of India releases specific regulations and guidelines regarding the legal use of cryptocurrency, this practice remains in a legal grey area.

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