How to Legally Transfer Money to India as a Business & Get Better FX Rates*

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Did you know that certain money transfer services, like Xoom/PayPal, are only for individuals and not businesses where as there are other services, like OFX, which are only for businesses and not individuals? At Oxigen, we give you the best of both worlds and also make sure that your money transfers are 100% legal.

One might say, “But I transfer money from my US bank account to my Indian bank account using a money transfer service for individuals and then make business-related payments from my Indian bank account”. Although you’re not alone – in fact, our market research shows that many NRIs are doing this – we’re pretty sure that this flow of funds is not compliant with law if the money transferred to India is ultimately for business reasons, e.g. paying a software development firm for engineering work or paying a landlord for rent of a commercial property.

One might then say, “But everyone does it, like speeding on the highway. I won’t get caught”. That may be true, however, you could be at risk of penalization in the event that your personal transfers to India are determined to be for business purposes. For example, in the event that you were audited by the IRS after filing your tax return, your transfers to India could be exposed and reported to the Indian government.

“Fair point, but what should I do? Isn’t starting a company a big hassle and expense?”, one may ask. Contrary to popular belief, starting a company in the US is actually quick, easy, and affordable. The government has created a very convenient corporate structure for individuals to have their own one-person companies without requiring a separate tax return, overhead, and professional services: the Limited Liability Corporation or LLC for short. Costs vary by state, but starting an LLC costs less than $1,000 and can be done in a day or two online. provides a good online guide for starting an LLC, where you can just select your state of residence and it tells you how to proceed accordingly. You can interact directly with your state government’s website to form the LLC or, for a fee, you can use a service like or to manage the process for you.

What all can an LLC do for you?

  1. An LLC provides you with a shield for (almost) all liabilities associated with your business activities. For example, let’s say you sell a mobile app online and one of your users claims to have an injury resulting from your app. If you don’t have an LLC (or other corporate structure), then the user sues you as an individual and your personal assets may be at stake; whereas if you have an LLC then the user would sue the LLC and your personal assets should be protected – there are some things that corporate structures do not protect against such as fraud (more on that, here).
  2. You could make use of money transfer companies that only serve businesses, and, in the case of Oxigen, take advantage of our superior business money transfer rate. Today, for instance, Oxigen’s FX rate for individuals is Rs 63.36/$1 whereas for businesses it’s Rs 65.37/$1, a difference of over 2 Rupees per Dollar!
  3. Lastly, and perhaps even more importantly, with an LLC you should not be at risk of legal problems if you are transferring money to India for business reasons as an individual since it would be the LLC transferring the money, not you as an individual.

I have an LLC and have transferred money to India through Oxigen using the business money transfer service – and it works great!

In short, if you transfer money to India for business reasons, you should be doing it through a corporate structure. If you’re not using a corporate structure, you should consider setting up an LLC to not only protect yourself, but also to take advantage of better rates and services offered only to business clients.

Try us out for FREE: Send your first business money transfer to India on us.

* Please note that this article does not provide any legal, tax, or accounting advice and that the author is not liable for any claims, damages, costs, or other factors resulting from a reader’s review of the article. Please consult an attorney or accountant if you would like advice on the subject matter described in the article.

Amir is an accomplished entrepreneur with expertise in international business, IT, and telecom. He received his Master’s from MIT Sloan and has started 4 companies impacting the lives of millions globally. Red Herring featured Amir as one of the “Top 25 [Entrepreneurs] Under 35”. Amir enjoys yoga, kitesurfing, and travel.

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