Let’s say you’ve just closed a $5,000 consulting contract with a US startup. And the client’s finance team asks for your bank details to process the payment. Naturally, you send your Indian bank account information. Two days later, their accountant writes back saying they prefer to process ACH transfers to US bank accounts.
After negotiating, they eventually agree to wire it manually. Five business days later, $4,900 is deposited into your account. Nobody told you $50 would disappear.
This is the default experience for many Indian consultants billing US clients. Not because cross-border payments are inherently expensive, but because many consultants are using infrastructure that wasn’t built for them. In this article, we’ll discuss how to compare your global banking options before you send out the next invoice.
Most Indian consultants don't fully understand the payment systems their US clients use, and that knowledge gap creates avoidable problems. So, when someone sends money from overseas to you in India, here’s what’s actually happening.
ACH transfers
ACH is the backbone of US domestic business payments. When a US company pays its vendors, its software subscriptions, its contractors, it almost always uses ACH. The transaction is initiated through the client’s bank or accounting software, processed via the ACH network, and settles in the recipient's US bank account within 1 to 2 business days. T
For a US finance team, ACH is the path of least resistance. It’s automated, integrates with their accounting software, and requires no manual approvals. When you provide a US routing number and account number, you become a domestic vendor in their system.
International wire transfers (SWIFT)
When ACH isn’t possible, US companies send international wires through the SWIFT network. This requires manual initiation at the bank, typically costs the sender $25 to $50 in outbound wire fees, and can take up to 5 business days to arrive.
Fintech payment platforms
Some US clients pay via platforms such as PayPal, Wise, Grey, or Payoneer. Each has different mechanics, different fee structures, and different implications for the Indian consultant receiving the payment. The key variables are where the conversion occurs and at what rate.
FEMA repatriation requirements
Under the Foreign Exchange Management Act (FEMA), Indian residents receiving foreign payments for the export of services are required to repatriate those earnings to India within a specified period. Under current Reserve Bank of India (RBI) guidelines, export proceeds must be realised and repatriated within nine months of the date of export of services.
In practice, this means that consulting fees earned from US clients cannot be held indefinitely in a foreign account. The money must come back to India within that nine-month window. This applies regardless of which platform or account you use to receive the payment initially.
Purpose codes
When a foreign payment arrives at an Indian bank, the bank requires a FEMA purpose code to classify the transaction. For consulting and professional services, the most commonly applicable codes are P0802 (software consultancy and implementation) and P1006 (business and management consultancy services). If you’re providing technical consulting, P0802 typically applies. If you’re providing strategy, operations, or management advice, P1006 is more likely correct.
Getting the purpose code wrong doesn’t automatically create a legal problem, but it can delay the credit to your account and trigger a compliance query from your bank that requires documentation to resolve. Most Indian banks will ask you to confirm the purpose code when an inward remittance arrives. Knowing the right one in advance saves time.
GST on export of services
Indian consultants providing services to US clients are exporting services under the GST law. The export of services is classified as a zero-rated supply under the Integrated Goods and Services Tax (IGST) Act, which means GST is not charged to the US client.
However, zero-rated doesn’t mean no compliance obligation. If your annual turnover from consulting exceeds ₹20 lakh (₹10 lakh in some states), you are required to register for GST. You must file returns even on zero-rated exports.
To export services without paying IGST upfront and claiming a refund later, you need to file a Letter of Undertaking (LUT) with the GST authorities at the beginning of each financial year. Filing the LUT is free and can be done online through the GST portal. Not filing it means you either charge IGST (which your US client will not want) or pay it yourself and wait for a refund.
Income tax
Foreign consulting income is taxable in India as business or professional income. It must be declared in your Income Tax Return (ITR) and is subject to standard income tax slabs. If your estimated annual tax liability exceeds ₹10,000, advance tax payments are required in four instalments: June 15th, September 15th, December 15th, and March 15th.
Maintaining clean records of every foreign payment received, including the purpose, the exchange rate at the time of receipt, and the INR equivalent, makes the annual ITR filing significantly simpler and protects you in the event of a scrutiny notice.
This is general guidance, not professional tax advice. FEMA and GST regulations are detailed and subject to change. Consult a chartered accountant familiar with foreign income for advice specific to your situation.
Before diving into the details, it’s worth understanding that there are many different payment methods. The right option depends on how frequently you're paid, how much you’re receiving, and how much control you want over your money.
Here are five real options, with actual mechanics and structures for each, covered in the comparison table below.
Also read: Wise vs Payoneer and PayPal: which is better for Indians?
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If your client insists on ACH and you don’t have US banking details, a wire transfer will not solve this. You need an account that provides a US routing number and account number. Payoneer, Wise, and Grey do this.
If you’re already on Upwork or Fiverr, Payoneer may already be your default payout method. The 2% withdrawal fee is the cost of convenience. If your monthly consulting income through these platforms exceeds $5,000, it’s worth evaluating whether a separate account with lower withdrawal costs saves more than the setup effort.
If your primary concern is cost of conversion, Wise and Grey offer the lowest conversion margins of the options covered. On a monthly income above $2,000, the difference between Payoneer’s 2% withdrawal fee and Grey's 1% conversion fee capped at $6 is significant, especially when accumulated over time.
If you pay USD-denominated expenses like AWS, Figma, Notion, ChatGPT Plus, and Google Ads, you likely have been converting to INR to pay for these tools, which means you’re buying USD at retail rates every billing cycle. If you hold a USD balance with platforms like Wise and Grey, you can pay directly from the account and eliminate that recurring conversion cost.
If you’re billing clients in EUR, GBP, and USD, a multi-currency account with local banking details for each currency is worth the setup. Grey provides USD, EUR, and GBP account details from a single account.
Also read: Best way to receive US dollar payments in India
Grey gives Indian consultants US bank accounts with a routing number and account number, without requiring a US entity, a US address, or a trip to a US bank branch.
When you share your Grey routing number and account number with a US client, they can pay via ACH exactly as they would pay any domestic US vendor. From their finance team’s perspective, it’s a standard domestic payment.
Here’s what the cost structure looks like on a real transaction. A $5,000 consulting payment received via ACH incurs a 0.8% deposit fee, capped at $10. That’s $10 to receive $5,000 in full to your USD balance. Compare that to $30 to $80 lost in transit on a wire transfer before conversion has even started.
When you’re ready to convert to INR, Grey applies a 1% conversion fee capped at $6. The rate is shown to you before you confirm the conversion. You choose when to convert, whether that’s immediately on receipt or after watching rates for a few days.
One important clarification: FEMA repatriation requirements apply to funds held in Grey accounts just as they apply to any foreign account holding export proceeds. Consulting income received into your Grey USD account must be repatriated to India within nine months under current RBI guidelines.
Also read: Receive consulting payments from abroad in Nigeria
Grey is a great choice for Indian consultants and freelancers who need a simple, reliable way to receive payments in USD, EUR, and GBP from international clients. You can access cross-border payments at low, transparent fees, and withdraw funds quickly to your local account.
Download the Grey app today to manage your international earnings conveniently from your phone.
Can I receive USD payments from US clients directly into an Indian bank account?Yes, but only via international wire transfer via the SWIFT network, which is the most expensive option. Indian bank accounts don’t support ACH, SEPA, or other local payment networks.
Do I need to pay GST on consulting income received from US clients?The export of services to US clients is classified as a zero-rated supply under the GST law, meaning GST is not charged to the client. However, if your annual consulting turnover exceeds ₹20 lakh, you are required to register for GST and file returns. Consult a chartered accountant for advice on your specific situation.
What is FEMA repatriation, and does it apply to my consulting income?FEMA, the Foreign Exchange Management Act, requires Indian residents who earn foreign income from the export of services to repatriate those earnings to India within nine months of the date of service export. This means consulting fees earned from US clients must be brought back to India within that period, regardless of which platform or account you use to receive them initially.
How long does it take for a US client payment to reach my Indian bank account?It depends on the payment method. Via international wire transfer: 1-5 business days, plus additional processing time at your Indian bank. Via ACH to a multi-currency account, then withdrawal to an Indian bank: typically three to five business days total (one to two days for ACH settlement, one to two days for withdrawal processing). The ACH route is both faster and cheaper than wire transfer for most transaction sizes.
Grey charges fees on deposits, conversions, and withdrawals. Deposits via ACH, SEPA, or FPS incur a 0.8% fee (minimum $2/€2/£2, maximum $10/€10/£10). Currency conversions are charged at 1%, capped at $6. Withdrawal fees vary by currency. Cross-border card transactions (non-USD purchases on a USD card) incur a 2% fee plus $0.50. Exchange rates are variable and include a margin over the mid-market rate. Always review fees and the rate before confirming a transaction. Visit our pricing page for current rates.
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