Global Fintech Fest: FM Sitharaman Launches Foreign Currency Settlement System at GIFT City

Mumbai — Finance Minister Nirmala Sitharaman on Tuesday unveiled a foreign currency settlement system (FCSS) at GIFT City, aiming to facilitate international trade, attract investment, and enhance ease of doing business.

Speaking at the Global Fintech Fest 2025, Sitharaman explained that the system is designed to enable seamless real-time or near real-time settlement of foreign currency transactions, improve liquidity management, and ensure regulatory compliance.

The FCSS will operate as a payment system within the International Financial Services Centre (IFSC) at GIFT City, placing it among a select group of global financial hubs — including Hong Kong, Tokyo, and Manila — with the infrastructure to settle foreign currency transactions locally.

Currently, transactions in foreign currencies by IFSC entities are routed through correspondent banking arrangements, involving multiple banks and participants, and do not settle in real-time, often taking 36–48 hours. The FCSS is expected to dramatically shorten settlement times, enhance operational efficiency, and strengthen liquidity management, all under regulatory oversight per the Payment and Settlement Systems (PSS) Act.

For the US dollar clearance, Standard Chartered India has been selected as the settlement bank.

The Finance Minister highlighted India’s growing fintech ecosystem, noting that the country ranks third globally in the number of fintech companies and leads in digital payments, having processed over 18,580 crore UPI transactions worth Rs 261 lakh crore in 2024-25.

GIFT City, or Gujarat International Finance Tec-City, is a central business district in Gandhinagar, Gujarat, envisioned as a hub for international financial services and fintech innovation.

With inputs from IANS