Mumbai, Oct 7 : With an aim to boost international trade, investment, and ease of doing business, Finance Minister Nirmala Sitharaman on Tuesday unveiled foreign currency settlement system in GIFT City.

Addressing the 'Global Fintech Fest 2025' here, Sitharaman said that 'foreign currency settlement system to solve the problem of facilitating seamless transactions on real-time basis, enhance liquidity management, and ensuring compliance."

She further informed that the FCSS will be a payment system within IFSC designed for settling transactions in foreign currency on a real-time basis or near real-time basis. "GIFT IFSC joins select group of financial centres that include Hong Kong, Tokyo, Manila, and so on, having infrastructure to settle foreign currency transactions locally," the Finance Minister added.

With the operationalisation of the FCSS, GIFT IFSC joins a select group of global financial centres - including Hong Kong, Tokyo, and Manila - that have the infrastructure to settle foreign currency transactions locally.

Transactions in foreign currency by entities and International Financial Services Centre (IFSC) are currently settled through the correspondent banking arrangement which is routed through different participants and multiple banks. Such transactions are not settled on a real-time basis.

Sitharaman said that FCSS facilities seamless and efficient settlement of foreign currency transactions within IFSC on a real-time basis, not 36-48 hours, enhancing liquidity management and operational resilience, ensuring compliance with regulatory oversight under PSS Act.

Standard Chartered's India unit has been selected for US dollar clearance.

The foreign currency settlement system will function as a payment arrangement in the International Financial Services Centre.

This foreign currency settlement system has been designed to ensure that transactions in foreign currency are completed in real-time or around real-time.

India now ranks third in the world for the number of fintech companies and also leads in digital payment volumes, having processed over 18,580 crore UPI transactions worth Rs 261 lakh crore in 2024-25.

Gujarat International Finance Tec-City, also called GIFT City, is a central business district in Gandhinagar, Gujarat.

/IANS