India Entry AdvisoryAn Infodit Group entity

Sector Guide — Fintech

India Entry for Fintech

Fintech is India’s most licence-sensitive entry sector. The entity is the easy part — the real work is mapping your activity to the right RBI or SEBI licence and FDI cap before you build.

Map Your LicenceFDI Routes & Caps →
In short: Foreign fintechs usually incorporate a wholly owned subsidiary, but the activity determines the licence and FDI position: payments need RBI Payment Aggregator/Gateway authorisation, lending needs NBFC registration, wealth and broking sit under SEBI, and insurance under IRDAI. The RBI Regulatory Sandbox and India’s public digital infrastructure (UPI, Account Aggregator) shape product design. We confirm the current cap and licence for your activity.

Why India for fintech?

India combines scale, one of the world’s highest rates of digital-payment adoption, and public digital infrastructure — UPI, Aadhaar-based KYC, DigiLocker, Account Aggregator — that any regulated player can build on. Few markets offer this combination of size and rails.

Entity & FDI

A wholly owned subsidiary is the standard vehicle, but several financial-services activities carry sector caps or conditions. Confirm the position for your specific activity on FDI entry routes before finalising the cap-table and licence application.

Licensing map — activity decides the regulator

ActivityRegulatorTypical authorisation
Payments (aggregation / gateway)RBIPA / PG authorisation
LendingRBINBFC registration
Wealth / broking / capital marketsSEBIInvestment adviser / broker registration
Insurance distributionIRDAIInsurer / intermediary licence
Account AggregationRBIAA licence

The RBI Regulatory Sandbox

The RBI runs cohort-based sandbox testing that lets fintechs pilot innovative financial products under relaxed conditions before a full rollout — useful where a product does not yet fit an existing licence category.

KYC/AML & data localisation

  • RBI-compliant KYC / AML (video KYC, Aadhaar-based e-KYC where eligible)
  • Payment-system data localisation — end-to-end payment data stored in India
  • PMLA obligations — record-keeping, suspicious-transaction reporting, principal officer

Building on India Stack

UPI, the Account Aggregator framework and DigiLocker let regulated fintechs deliver payments, consented data access and document verification on shared public rails — shrinking build time and improving user trust.

Frequently asked questions

Can a foreign fintech operate in India?
Yes, typically through a wholly owned Indian subsidiary — but the specific activity (payments, lending, wealth, insurance) determines the licence and any FDI cap, which we confirm before setup.
What licence does a payments or lending fintech need in India?
A payments business generally needs RBI Payment Aggregator/Gateway authorisation; a lending business needs to register as an NBFC with the RBI. Capital-markets products fall under SEBI.
Is there a regulatory sandbox for fintech in India?
Yes. The RBI operates a cohort-based Regulatory Sandbox that lets fintechs test innovative products in a controlled environment before a full launch.
Are there data-localisation rules for fintech in India?
Yes. The RBI requires payment-system data to be stored in India, and KYC/AML and PMLA obligations apply. We build the compliance framework into the setup.

Reviewed by CA Regi Tom Antony, Regi Tom Antony & Associates. Last updated: July 2026.

Launching a fintech in India?

We map your activity to the licence, cap and compliance framework before setup.

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