How to Send Money from India Abroad: Safe, Fast & Compliant Methods

Sending money out of India is one of those transactions where the friction is rarely about the money itself. The rails work. The recipient is ready. What slows things down is the paperwork around the Reserve Bank of India’s compliance regime, the choice of bank versus fintech, and small but expensive details like which purpose code to declare and what tax gets collected at source.

This is a working guide for residents and NRIs who need to move funds abroad without overpaying, without delays, and without falling foul of the rules.

What Counts as “Outward Remittance” from India

Outward remittance is any transfer of funds from India to a beneficiary outside India. The most common reasons are family maintenance, education fees, medical treatment, travel, gifts, investments in foreign securities, and property purchases abroad.

For residents (people who live in India and are tax-resident here), outward remittance is governed by the Liberalised Remittance Scheme (LRS) under the Foreign Exchange Management Act, 1999 (FEMA). For Non-Resident Indians and foreign nationals, the rules are different and depend on the source of the funds and the account type (NRO, NRE, or FCNR).

The Reserve Bank of India sets the framework. Authorized dealer banks (most major Indian banks) carry out the transfers and report them. Fintech platforms operating in this space layer themselves on top of the same bank rails, with a cleaner customer experience.

The Liberalised Remittance Scheme in Plain English

The single number every Indian resident should know is USD 250,000. That is the annual ceiling under the LRS, per resident individual, per financial year (April 1 to March 31). Within that ceiling, you can remit for any permissible purpose without prior RBI approval, subject to your bank’s documentation and KYC.

A few important things the LRS allows under that limit:

• Private travel abroad (excluding Nepal and Bhutan)
• Gifts and donations to relatives or organizations abroad
• Maintenance of close relatives living abroad
• Education expenses, including tuition, hostel fees, and books
• Medical treatment abroad
• Employment abroad or emigration costs
• Investment in foreign equity, debt, real estate, and mutual funds

A few things the LRS does not allow, even within the limit: remittance for margin trading, lottery purchases, the purchase of foreign currency convertible bonds issued by Indian companies abroad, or any activity expressly prohibited by FEMA.

Tax Collected at Source (TCS) on LRS

Since October 2023, Tax Collected at Source applies to most LRS remittances above INR 7 lakh in a financial year. The current headline rate is 20% for general purposes, with reduced or nil rates for specific categories like overseas education funded by a loan from a financial institution and medical treatment. TCS is not an extra tax. It is collected by the bank at the time of remittance and credited against the remitter’s income tax liability when they file their return.

Confirm the latest TCS slabs with your bank or a tax advisor before a large send. The percentages have moved more than once in recent budgets.

Bank vs. Fintech: Where the Money Actually Moves

Both routes use the same SWIFT and correspondent banking infrastructure underneath. What differs is the layer the customer sees.

Factor	Indian Bank Branch / Online Banking	Authorized Fintech / Money Transfer App
Speed	One to three business days	Often same-day or instant where rails support it
Fees	INR 500 to INR 2,500 in charges plus FX markup	Lower fees, FX spread closer to mid-market
Documentation	A2 form, PAN, purpose declaration, supporting documents	Same documents, mostly digital upload
Limits	Up to LRS USD 250,000 per FY	Up to LRS USD 250,000 per FY
Customer support	Branch hours, phone banking	App chat and longer support windows

Banks are still the default for very large transactions and for property-related remittances where the receiving party expects a SWIFT wire from a known correspondent bank. For routine sends, especially education fees, family maintenance, and small recurring transfers, authorized fintechs typically offer better rates and a smoother experience while operating under the same RBI framework.

Travel Tip: The Document Pack You Will Always Need

Before initiating any LRS remittance, keep these ready in digital form:

• PAN card
• Aadhaar (for KYC if not already done)
• Address proof
• Bank statement or salary slip showing source of funds for large transfers
• Form A2 (filled in the bank’s portal or paper)
• Supporting documents tied to the purpose: invoice, admission letter, medical referral, and the like

The single most common cause of LRS delays is missing or mismatched supporting documents, not the actual money movement.

Picking the Right Purpose Code

Every outward remittance has to be declared under a specific purpose code (the S codes in RBI’s framework). Some examples used most often by individuals:

• S0301: Maintenance of close relatives abroad
• S0305: Education
• S0306: Medical treatment
• S1301: Travel expenses
• S0801: Personal gifts and donations
• S0902: Investment in foreign equity and debt

The purpose code is the customer’s responsibility. Banks and fintechs make the selection easier with checklists and tooltips, but the declaration on the A2 form is yours. Picking the wrong code does not make the transfer illegal, but it can flag the transaction for review and slow everything down. If you are not sure which code applies, ask the bank’s remittance desk in writing before submitting.

Compliance: What the Bank or Fintech Is Actually Doing

Behind the scenes, every outward remittance gets checked against three layers:

• KYC: Confirming the remitter is who they say they are.
• AML screening: Checking the transaction against sanctions lists and unusual-pattern flags.
• FEMA reporting: Reporting the transaction to the RBI in the prescribed return.

This is why even a small remittance can stall if KYC is incomplete or if the source of funds for a large send is not documented. Cooperating quickly on follow-up questions usually clears the transfer faster than escalating.

NRIs Sending Money Out of India

For Non-Resident Indians, the rules depend on which account the money sits in.

Funds in an NRE account (foreign earnings deposited in India) are fully repatriable. They can be sent back abroad without RBI approval beyond standard KYC and tax compliance.

Funds in an NRO account (Indian earnings such as rent, dividends, or pension) are repatriable up to USD 1 million per financial year, subject to tax clearance and documentation. The bank will ask for a CA-certified Form 15CB and a Form 15CA filed with the income tax department for most repatriations.

Funds in an FCNR(B) account (foreign currency fixed deposits) are repatriable in the same currency, with maturity proceeds going to the chosen foreign account on instruction.

For NRIs based in the US who also send money back to India for family support, education, or property, the reverse leg has its own modern options. App-based services like Sliq Pay are built around the US-to-India direction, with mid-market exchange rates, instant settlement to UPI or bank accounts, and the kind of transparent fee structure that bank wires rarely match. The point is that the two-way flow does not have to use the same expensive channel in both directions.

Real-World Scenarios

Tuition fees to a UK university. A resident parent has paid INR 12 lakh in fees so far this year. The university has issued a new fee invoice for GBP 8,000. The parent’s bank initiates the LRS remittance under S0305 (Education) and applies the reduced TCS rate that applies to education-related remittances funded by a financial-institution loan. Funds reach the university account in two business days. The supporting invoice goes into the A2 form.

Maintenance for parents who moved to Canada. A working professional sends INR 50,000 per month to support parents living in Toronto. The remittance is declared under S0301. The fintech the professional uses processes the send in a few hours, applies a small FX spread, and the parents receive Canadian dollars in their bank the same day.

Repatriating NRO rent to the US. An NRI has been receiving rent in an NRO account in Mumbai. To send the accumulated balance to her US account, her CA issues Form 15CB. Form 15CA is filed online. The bank processes the repatriation within the USD 1 million annual limit.

Reality Check: What Actually Slows Outward Remittances Down

It is usually one of these, in order of frequency:

• A mismatch between the name on the recipient’s bank account and the name on the A2 form
• An unsigned or missing A2 form
• Wrong or vague purpose code
• KYC not refreshed at the remitter’s bank in the last 12 to 24 months
• TCS not collected at the time of remittance, requiring rework

None of these are inherent to the system. All of them are paperwork issues that get cleared faster the more documentation you have ready before initiating the send.

Frequently Asked Questions

What is the maximum I can send abroad from India in a year?

For resident individuals, USD 250,000 per financial year under the LRS, across all purposes combined. NRIs sending out of an NRO account can repatriate up to USD 1 million per financial year subject to tax clearance.

Do I need RBI approval for every outward remittance?

No. Within the LRS limit and for permissible purposes, you do not need prior RBI approval. The authorized dealer bank or fintech handles the reporting on your behalf.

What is the cheapest way to send money abroad from India?

For most retail amounts, an authorized fintech with mid-market exchange rates and transparent fees will deliver more foreign currency per rupee than a traditional bank wire. Compare the recipient amount, not the headline fee, across at least two providers.

Is TCS the same as income tax?

No. TCS is collected at the time of the remittance and credited against your final income tax liability when you file your return. If you have no tax dues, it gets refunded.

Can I send money to my own foreign account?

Yes. Self-transfers to a foreign account in your name count toward your LRS limit and follow the same documentation. The purpose code will usually be the relevant maintenance, investment, or education code depending on the destination account.

What documents do I need on the receiving side?

Recipient name, full bank address, account number, SWIFT/BIC code, and for some currencies the local equivalent (IBAN for Europe, sort code for the UK, routing number for the US). Mismatches between the name and account holder are the most common cause of returns.

Are there penalties for breaching LRS limits?

Yes. Exceeding USD 250,000 in a financial year without an approved exception is treated as a contravention of FEMA. Penalties can include monetary fines and additional reporting. Banks will block transactions that breach the limit before they settle.

What if I am an NRI sending money to family in India from abroad?

That is the reverse direction and follows a separate path: a US-based remittance app or a foreign bank wire to an Indian bank or UPI ID. Modern services like Sliq Pay handle the US-to-India direction with instant UPI delivery and mid-market FX, which is often faster and cheaper than a SWIFT wire.

Bottom Line

Sending money out of India is mostly an exercise in matching the purpose to the right code, having the documents ready before you start, and picking a provider whose costs you can actually see. The LRS gives most individuals more headroom than they need; the friction is in the paperwork, not the limit. Get the documents in order, declare honestly, and the transfer itself is the easy part.

Disclaimer: The information provided on this blog is for general informational purposes only and does not constitute legal, financial, tax, or professional advice. Product features, pricing, eligibility, and availability may vary by country, user type, regulatory requirements, and are subject to change. Please refer to Sliq Pay’s Terms of Use and official product pages for the most accurate and up-to-date information. Sliq Pay makes no representations or warranties regarding the completeness, accuracy, or reliability of the content.