Treasury Beyond Borders - How India is rewriting the treasury rulebook

With the Unified Payments Interface now recognised as the world’s largest real-time payments system and pilots for a digital rupee underway, India is rapidly becoming a blueprint for treasury modernisation. From new crossborder corridors to the rise of GIFT City as an international hub, this article explores how these developments are reshaping cash, liquidity, and risk strategies for corporates operating in and through India.

India has long been on the radar for multinational treasuries – as well as being a vast economy with a growing consumer base and a flair for innovation, the country also represents a complex regulatory environment. But the pace of change in recent years has shifted the country’s role on the global treasury map.

Aditya Lakhanpal, Managing Director, Corporate Sales, Markets and Securities Services, HSBC India, notes: “India’s GDP is now close to US$4.2tr. and in the past couple of years it has been growing at 6.5 to 7% year-on-year¹. Given the sheer scale of the opportunity, most corporates either want to sell in India, source in India, or they want to do both.”

At the heart of this evolution sits liberalisation – in banking and securities regulations, the rules for how companies can invest, and the local tax regime. Although hurdles still remain, treasurers are now benefitting from new avenues for cash pooling, and more flexibility in intercompany financing.

The scale of real time

Nothing captures this change more vividly than the way India has embraced real-time payments. Lakhanpal points out that “India is the largest instant payments market in the world today. The Unified Payments Interface [UPI] has seen digital payments grow from nine million transactions a year in 2017-18, to 18 billion transactions a month now². On any given day, Indians process the same volume through UPI that Visa processes across its entire global network.”

For treasury teams, UPI reshapes how liquidity is managed on a daily basis. “UPI enables instant settlement and gives treasurers real-time visibility into their cash positions,” says Mohit Agarwal, Managing Director, Head of Global Trade Solutions, India and South Asia, HSBC. “This reduces the need for holding large precautionary balances and enables funds to be deployed more optimally across the organisation. But it also means treasuries need to rethink their systems and operating models – moving away from batch processing and traditional business hours, and towards automation and 24/7 readiness.”

Interestingly, each UPI transaction carries a unique identifier, which can be ingested directly into treasury platforms. “That allows for instant reconciliation,” Agarwal notes. “But it also puts pressure on legacy systems. Most treasuries are now upgrading their platforms to cope with the sheer volume of transactions, investing in automated reconciliation tools – often powered by AI – that can learn from exceptions and fix mismatches instantly. It is also freeing up credit limits faster and enabling sales teams to do more business with the same headroom.”

Crossing borders with confidence

The effects of UPI are now spilling beyond India’s borders. Lakhanpal highlights how “anyone travelling to Paris today can buy a ticket at the Eiffel Tower using their UPI app.” Bilateral UPI linkages with countries such as Singapore and the UAE are giving treasurers access to near-instant crossborder transfers, reducing settlement lags and improving reconciliation cycles.

In parallel, India is taking steps to internationalise the rupee itself. Local currency trade settlement arrangements – such as the rupee-dirham bridge with the UAE – enable corporates to invoice and settle directly in INR, a move expected to lift bilateral trade between the two countries to more than US$100bn.

Lakhanpal adds: “India has also eased hedging guidelines by giving global treasuries access to deep onshore markets, and allowed non-residents to open special rupee accounts so they can invoice and settle in INR. Fast payments on the crossborder side and INR-denominated trade, which can be hedged and delivered onshore, are significant enablers for corporates.”

A fintech ecosystem at scale

This willingness to innovate is also reflected in the broader fintech landscape within the country. Five years ago, India had around 200 registered fintechs, yet today the figure stands above 10,000. “Payments, digital lending, WealthTech, InsurTech, neobanking, SaaS – the ecosystem is vibrant,” Agarwal remarks. “Corporates are embracing fintech solutions for treasury management, whether that is real-time cash visibility, predictive liquidity forecasting, or end-to-end reconciliation powered by AI. The way treasuries are adopting these platforms is amazing, and you will see much more happening in this space.”

The promise of the digital rupee

No conversation about India’s treasury transformation is complete without mention of the digital rupee. Lakhanpal explains: “The digital rupee is India’s central bank digital currency, a digital form of the physical rupee issued by the Reserve Bank of India [RBI]. It offers features similar to physical cash, like convenience of use, RBI backing, and finality of settlement. Usage is currently being piloted across both retail and wholesale segments.”

On the wholesale side, pilots cover settlement of government securities and interbank lending in the call money market. But it is programmability that excites treasurers most. “Funds in a CBDC wallet can be designated for a specific end use, which is arguably one of the most powerful features,” Lakhanpal stresses.

Agarwal develops the point. “Like UPI, the digital rupee will enable near-instantaneous settlement of wholesale and retail transactions, which reduces settlement lags and counterparty risk. The programmability and automation possible in CBDC platforms could streamline workflows further – enabling programmable settlement instructions, escrow arrangements, and just-in-time payments. Every transaction is immutably recorded, providing treasurers with a detailed audit trail. Once this facility reaches scale, costs should fall significantly for corporates.”

These partnerships are also reshaping SCF, says Agarwal, noting that treasurers are using new platforms for vendor management and dynamic discounting, often in combination with bank solutions. The result is a treasury environment that is both more automated and more strategically aligned with business needs, he believes.

Alongside the growing fintech ecosystem, multinationals are also watching the rise of GIFT City, India’s International Financial Services Centre. Lakhanpal clarifies its relevance.“Treasury centres exist to centralise liquidity and riskmanagement and to use financial resources strategically. GIFT City provides a comprehensive framework for this – covering FX, cash management, fundraising, and intragroup financing. It benefits from having a single unified regulator and a very attractive tax regime on income, dividends, and interest.”

Agarwal has seen the progress first-hand, as he explains. “Each time you visit GIFT City, there is more and more to see – the pace of change and development is constant. And it offers cost advantages compared with other offshore centres, world-class real estate, abundant skilled talent, and plug-and-play facilities. For treasury teams, the appeal lies in the ease of cross-border flows, with no restrictions on holding or transferring funds in major currencies and deep pools of liquidity already available through international and Indian banks. Overall, it’s a very exciting space for treasury.”

Embedding ESG into financial decisions

Another interesting trend is that sustainability is now firmly embedded in treasury thinking in India. “ESG has become an important metric for most large corporates in the country,” Agarwal explains.

“Treasuries are aligning with SEBI’s [Securities and Exchange Board of India] mandatory Business Responsibility and Sustainability Reporting framework, which requires disclosures on energy use, carbon emissions, water usage, waste management, and social impact. Increasingly, treasuries are therefore embedding ESG in investment and funding decisions – favouring green bonds, sustainable fixed income instruments, and responsibly governed counterparties.

“Treasuries are also enhancing transparency, reducing paper through digitisation, and collaborating across functions to embed ESG in governance and risk frameworks,” he concludes.

A laboratory for the future of treasury

Amid all of this innovation, the pressing question for treasurers is what success looks like as we head towards 2030. Lakhanpal sees two priorities: “The first is adaptive risk management. Treasuries will need to bring their A-game every day and be nimble. While foreign exchange is often top of mind, and rightly so, treasuries increasingly need to focus on other asset classes such as interest rates or commodities. The second is about the pace of change. In India, things move quickly – regulations, systems, scale, business models. That makes it vital to have the right partners on the ground who can offer timely insights and local expertise.”

This sense of dynamism is arguably what makes India so compelling. From UPI’s billions of monthly transactions and the potential of the digital rupee, to GIFT City’s emergence as an international hub and the integration of ESG into treasury strategy, the country is redefining how corporates think about liquidity, risk, and growth.

Of course, though, India’s transformation is far from complete. There is still much change ahead, but the trajectory is clear. And for treasurers willing to adapt, it offers not just challenges but opportunities to re-imagine their operating models.

As Lakhanpal concludes: “The pace of change is unbelievably fast in India. That makes it vital to have the right partners to guide you. But it also highlights that the country is no longer simply a destination for investment, it has become a laboratory for the future of treasury. And what emerges in India today will help to shape treasury practice worldwide tomorrow.”