Real-Time Foreign Exchange Settlements: A Game-Changer for Indian MSME Exporters

India’s financial infrastructure is entering a new era. The Reserve Bank of India (RBI), in collaboration with GIFT (Gujarat International Finance Tec-City) City’s International Financial Services Centre (IFSC) and the Ministry of Finance, has enabled real-time foreign exchange (FX) settlements under the newly launched Foreign Currency Settlement System (FCSS) .

This innovation, inaugurated by Finance Minister Nirmala Sitharaman at the Global Fintech Festival 2025, allows participating banks in GIFT City to settle foreign currency transactions, starting with the US dollar, in seconds rather than days . It marks a major leap for exporters and importers by speeding up payments, reducing dependence on foreign intermediaries, and strengthening India’s position as a global financial hub.

What’s Changing?

Until now, cross-border settlements often took 24–48 hours and depended heavily on foreign correspondent banks. The new FCSS eliminates these delays by enabling instant onshore clearing of USD transactions within GIFT City through its local settlement banks, initially led by Standard Chartered Bank India .

By bypassing multiple Nostro accounts and correspondent routes, Indian institutions within GIFT City can now transfer funds directly, improving liquidity, cutting transaction costs, and drastically reducing settlement risk . Additional major currencies such as the euro and yen are expected to be added later.

The RBI and the International Financial Services Centres Authority (IFSCA) are now testing the system for broader access by domestic banks across India in the coming months .

Why MSMEs Should Take Notice

For micro, small, and medium enterprises engaged in imports or exports, timely receipt and settlement of foreign payments are critical.  Real-time FX settlements can help MSMEs:

• Improve working capital turnover with instant access to funds after shipment.
• Avoid exchange losses caused by overnight currency fluctuations.
• Lower operational and banking costs by cutting out intermediary charges.
• Gain greater forecasting accuracy for cash flows and pricing.

Importers also benefit from instant visibility of exchange rates and reduced need for costly hedging strategies .

Call to Action for MSME Owners

• Evaluate your current FX settlement timelines and cost structures.
• Engage your authorized dealer bank to check eligibility for GIFT City’s real‑time settlement facilities.
• Update your accounting and export management software for faster reconciliation and processing cycles.
• Track market movements closely to lock in favorable rates in real time.

The launch of real‑time foreign currency settlements through GIFT City’s FCSS signals a transformative shift in India’s financial landscape . For MSME exporters and importers, this means quicker funds availability, reduced risk, and greater global competitiveness. Early adoption will allow businesses to optimize working capital, enhance financial agility, and compete more confidently in the fast‑changing global markets of 2025 and beyond.​