How India's digital infrastructure opened global markets to Indian investors

Indian residents remitted USD 11.33 billion abroad under the Liberalised Remittance Scheme in FY2017-18. By FY2023-24 the figure had reached USD 31.73 billion, the highest on record. Within that total, money earmarked for overseas equity and debt grew faster still, from USD 431 million in FY2019-20 to about USD 2.65 billion in FY2025-26, and from 2.3% of all outward remittance to 9.1%.

Those numbers are the result of two decades of rule changes, identity infrastructure and settlement reform, most of it built for reasons that had very little to do with investing abroad.

The paper era


The Liberalised Remittance Scheme began in February 2004 with an annual allowance of $25,000. The ceiling climbed quickly, to $50,000 in December 2006, $100,000 in May 2007 and $200,000 by September 2007. It was reduced to $75,000 in August 2013, a temporary measure adopted while the external account was under strain, then restored to $125,000 in June 2014 and set at $250,000 in May 2015, where it stands today.

Buying foreign exchange traditionally requires Form A2. This is the declaration a resident makes to the bank sending the money, setting out how much foreign currency is being bought and for what purpose, and confirming that the transaction is permitted under India's foreign exchange law. Through the scheme's first decade it had to be printed, signed by hand and submitted at a bank branch during working hours. Owning a foreign share required considerably more. A resident investor opened an overseas trading account through an Indian broker's foreign partner, completed a separate account-opening form for that partner, signed the LRS declaration, signed a FEMA declaration, and formally authorised a designated bank as the authorised dealer. The domestic requirements were comparable. A demat account meant physical forms, proof of identity and address in hard copy, in-person verification conducted at a branch, and a power of attorney executed for settlement.

By 2015 the allowance was ample for almost any individual investor. The procedure for using it had not changed in step.

The digital rebuild

The rebuild started with the paperwork and the rails. Online submission of the Form A2 declaration was permitted in February 2016, capped at USD 25,000, and UPI launched two months later to give India a domestic payment rail that cleared in seconds. Identity was rebuilt over the five years that followed. The Central KYC Registry became operational for regulated entities, DigiLocker documents were granted legal parity with physical originals, and video-based customer identification was permitted in January 2020, which made remote account opening lawful rather than merely convenient. The Account Aggregator framework went live in September 2021, so a person's own financial records could be shared on their instruction instead of being reassembled document by document. The market itself came last, with GIFT City's international exchange opening retail access to US-listed stocks in March 2022 and Indian equities completing the move to T+1 settlement in January 2023, ahead of every other major market.

Each of those measures addressed a domestic objective, and none was built with the outbound investor in mind. Assembled, they produced a means of establishing a person's identity in seconds and evidencing it to a regulated entity without a physical document changing hands.

As at 30 April 2025, cumulative Aadhaar e-KYC transactions stood at 2,393 crore, with 37.3 crore recorded in that month alone. DigiLocker had issued 990 crore documents to 57 crore registered users as at August 2025, and the user count has since passed 70 crore. The Account Aggregator network has fulfilled more than 45 crore consents and served over 500 crore data fetches since launch. UPI processed 2,264 crore transactions worth ₹29.53 lakh crore in March 2026 alone. By May 2026 India had roughly 22.9 crore demat accounts, 18.38 crore at CDSL and 4.51 crore at NSDL.

Tax administration moved alongside the infrastructure, with Finance Act 2020 introducing tax collected at source on LRS remittances from October 2020 and Finance Act 2023 setting the rate at 20% from October 2023. TCS is not a permanent cost. It is a tax advance, fully creditable against the investor's annual income tax liability, with any excess becoming a refund. Salaried investors declare it to their employer under Form 12BAA, introduced by CBDT Notification No. 112/2024, and the employer absorbs the credit against monthly salary TDS within the same financial year. Those with business or professional income offset it against quarterly advance tax instalments. Any balance is settled at ITR. TCS is a cash-flow timing issue, not a permanent drag.

The limit comes off

On 3 July 2024 the Reserve Bank removed the value cap on online Form A2 altogether. The operative instruction runs to a single clause: there shall not be any limit on the amount being remitted on the basis of an online Form A2. The full $250,000 allowance could now move without a printed page.

A week later, on 10 July 2024, permissible LRS purposes for remittances to International Financial Services Centres were widened, placing GIFT City on the same footing as any other offshore destination. From 1 April 2025, Finance Act 2025 raised the TCS threshold from ₹7 lakh to ₹10 lakh in a financial year, placing most retail remittances below the collection threshold. US equities had themselves moved to T+1 settlement on 28 May 2024, so both ends of a cross-border trade now clear on the next business day.

Participation has responded to these changes, with retail fund schemes at GIFT City counting 255 investors in September 2025, 1,239 in December 2025 and 3,438 by March 2026.

What it adds up to

For an investor diversifying globally from scratch, the distance between intent and ownership is now measured in hours on the fastest route. A decade ago it was measured in branch visits and courier cycles.

Identity verification and account opening through a GIFT City platform now completes in under a minute on reported timings, using Aadhaar, PAN and DigiLocker. The declaration is online and uncapped. Currency conversion and settlement is the longest single step in the sequence. Through the GIFT City route it is reported in a few hours. Through correspondent banking it typically runs to a business day or two.

What changed alongside the timing is what became available at all. Platforms like Appreciatenow offer fractional ownership and $1 minimums , so a share in the US stock market priced in the hundreds of dollars no longer sets the minimum ticket.

What comes next

Three further changes are in progress, each aimed at improving the customer experience.

IFSCA issued a draft framework in June 2026 under which an investor would complete KYC once with a registration agency and have it recognised across every intermediary inside GIFT City. It is in consultation rather than in force, and it would extend to GIFT City the identity reuse that already works at home.

Nexus Global Payments was incorporated in March 2025 by five central banks including the Reserve Bank of India, to connect national instant payment systems across borders. It addresses retail payments rather than capital account flows. It will likely shorten the money leg, and it places India among the five deciding how instant money moves between countries.

The migration to ISO 20022 for cross-border messaging completed on 22 November 2025, giving cross-border transfers richer and more structured data. The RBI's Payments Vision 2028, published in March 2026, commits to a review of cross-border payment efficiency and a streamlined single-window authorisation process, with a course of action running to December 2028.

A decade ago, global investing was reserved for those willing to navigate paperwork and delays. Today, the infrastructure has changed. For millions of Indians, global markets are now only a few digital steps away.

Authored by:

Ram Rastogi, Chairperson of the Governance Council at the Fintech Association for Consumer Empowerment (FACE)

Subho Moulik, Founder & CEO, Appreciate