India EOR guide
Bridge91 · India
FEMA and paying from abroad
The Foreign Exchange Management Act governs every foreign exchange flow into India, including paying people who work there. This is the mechanism that quietly makes informal arrangements unworkable.
- Governs
- All inward foreign exchange
- Route
- Authorised Dealer bank
- Reporting
- Reserve Bank of India
A foreign company cannot simply wire salary into an Indian employee’s personal bank account. Doing so without the correct documentation and route creates an exposure for both sides.
Under an Employer of Record arrangement, the client is invoiced in dollars, the funds are received through an Authorised Dealer bank with full FEMA documentation, converted to rupees, and paid out as Indian payroll.
This guide is general information about Indian employment law and practice, not advice on your situation. Rates and thresholds change. Talk to us before acting on any of it.
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