Taxation & Compliance
Posted on Sep 10, 2025
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If you are a business owner, freelancer, or professional in India who receives international payments from overseas clients, you might have heard of the term FIRC. You might be wondering if it is just another piece of banking paperwork, but in reality, it is one of the most important compliance documents if you are receiving payments in foreign currency.
Be it banks in India, the Reserve Bank of India, or tax authorities, they all rely on FIRCs to make sure that the foreign inward remittance is legitimate, traceable, and compliant with India’s exchange control laws. Without an FIRC, you can face delays in GST refunds, hurdles in financial audits, and even difficulty in proving export earnings.
In this blog, we will break down everything that you need to know about FIRC, from its meaning to its importance, how to obtain an FIRC, and what the common mistakes are to avoid while getting an FIRC. By the end of the blog, you will not only know how an FIRC works but also how to streamline the process by using a smarter payment solution like Infinity.
What is an FIRC?
FIRC stands for Foreign Inward Remittance Certificate. It is a document issued by the Authorised Dealer (AD) Category I banks in India to ensure that an individual or business has received a foreign remittance.
Think of FIRC as an official receipt confirming that the foreign payments have entered India legally and were credited to the user’s account.
For example-
A freelancer working in Bengaluru has received $1000 via SWIFT. The bank issues an FIRC to confirm the arrival of international payments.
An exporter in India shipping textiles to Dubai receives a payment of AED 50000. The FIRC works as proof to the DGFT and GST authorities that the foreign payment was received against the goods exported.
Why FIRC Matters?
FIRC helps in adhering to compliance with RBI, FEMA, DGFT, and customs in the following ways-
RBI uses FIRCs to monitor the inflow of foreign currencies in India.
FEMA (Foreign Exchange Management Act, 1999) requires all foreign transactions to be tracked for legality.
DGFT( Directorate General of Foreign Trade) needs FIRC for exporters claiming incentives.
Customs may request FIRCs in case of disputes over trade invoices or foreign exchange mismatches.
In short, without the FIRCs, your foreign trade may look incomplete in the government records.
Why is FIRC required for GST refunds?
One of the most practical uses of FIRCs is during the GST refund claims. Exporters and service providers must prove that they were paid in foreign currency; FIRCs are the strongest documentary evidence.
For example:
A software company exporting SaaS services to the U.S without charging GST can claim a refund of input tax paid, but only by showing FIRCs for the foreign payments.
FIRC for audit trail and legitimacy of foreign payments
When your book is reviewed by an auditor, FIRCs act as proof that:
Income came from a legitimate foreign source.
The correct exchange rate was applied.
Tax obligations were properly discharged.
This is especially critical for startups raising foreign investment or freelancers applying for visas/loans, as FIRCs prove that foreign income was legitimate.
Who needs an FIRC?
Exporters of Goods and Services
Every Indian exporter, whether shipping physical goods or providing IT/consulting services, needs an FIRC for:
Claiming GST refunds.
Availing export incentives like SEIS, EPCG, and Advance Authorisation.
Providing turnover for bank loans and working capital financing.
Freelancers, Consultants & Remote Workers
Freelancers often get paid via SWIFT transfers, PayPal, or platforms like Upwork. An e-FIRC helps them:
File taxes correctly.
Prove legitimate income to banks or visa authorities.
Avoid double taxation issues when dealing with foreign clients..
E-Commerce Sellers and Businesses Receiving International Payments
Online sellers on Amazon Global, Etsy, or Shopify often receive international payments in USD/EUR. FIRCs help them with tax refunds and compliance.
Startups receiving foreign investments may need FIRCs to prove compliance with the RBI’s FEMA rules.
In short, if you are earning in foreign currency, chances are that you need FIRCs.
What are the contents of a FIRC?
A valid FIRC typically includes:
Beneficiary name (Indian receiver)
Remitter name (Foreign sender)
Amount received in both foreign currency and in INR.
Exchange rate applied by the bank
Purpose code (mandatory RBI code explaining the reasons for remittance, eg, - P0103- advance payments from foreign clients against export contracts)
Date of credit
Unique transaction number (UTR)
Bank details of the beneficiary
Authorised dealer bank’s signature/seal
What are the different types of FIRCs and related documents?
Physical FIRC vs e-FIRC
Physical FIRC: Earlier banks issued paper certificates for every foreign remittance.
e-FIRC: Since 2016, RBI mandates electronic reporting via EDPMS (Export Data Processing and Monitoring System). Today, only e-FIRCs are valid.
FIRA, FIRS, and NOC- Key differences
FIRA (Foreign Inward Remittance Advice): It is a bank acknowledgment of receipt. This acts as a proof that the international transfer was successful.
FIRS( Foreign Inward Remittance Statement): A statement of all remittances, not equivalent to a FIRC.
NOC (No Objection Certificate): Issued when FIRC cannot be generated (e.g., if payment came via a non-AD bank).
How to obtain an FIRC?
Step-by-Step process in obtaining a FIRC:
Receive foreign remittance in your Indian bank account.
Ask your authorised dealer bank for a FIRC request form.
Submit required documents: invoice, purpose code, PAN, GSTIN (if applicable).
The bank generates an IRM (Inward Remittance Message) in the RBI’s EDPMS portal.
Once validated, the bank issues your e-FIRC in PDF format.
Timeline and Bank-Specific Variations in Generating a FIRC
Most banks take 7-15 working days.
Fees vary- some banks charge INR 100 to INR 500 per certificate.
Online-first banks and fintech solutions like Infinity may issue FIRA instantly after receiving international payments.
What are the use cases and real-world scenarios for FIRCs?
GST Refunds for Exporters
For exporters, FIRCs are essential for zero-rate GST refund claims. Without FIRCs, GST input credits may get stuck for months.
Claiming Export Incentives & FTP Benefits
Schemes like EPCG or Advance License require proof of foreign currency inflows- FIRCs are the proof in such cases.
Validating Freelance or Service Income
Freelancers applying for visas, home loans, or startup funding often rely on FIRCs to prove consistent foreign income.
What are the common issues while using an FIRC?
FIRC vs FIRA/NOC- Common Confusion
A common mistake that most professionals make is assuming FIRC=FIRA. Always double-check with your bank or DGFT- if they require an FIRA or FIRC.
Delay or Missing Data- How to Troubleshoot
Confirm remitter details and purpose code in advance.
Follow up with your bank if the FIRC is not issued within 15 days.
Keep track of UTR numbers for every inward remittance.
Best Practices for Record Keeping
Save digital copies of FIRCs for every transaction.
Maintain a separate compliance folder for audits.
Cross-check FIRCs with invoices to avoid mismatches during GST filing.
How InfinityApp helps with FIRAs and receiving international payments?
At InfinityApp, we make receiving international payments faster, cheaper, and compliant-friendly. Here is what you will get when you sign up with InfinityApp.
Lowest transaction fee: InfinityApp charges 0.5%(inclusive of all) as a transaction fee.
Fastest settlement: InfinityApp makes sure that your payment is settled within 24 hours. Traditional methods usually take 2-5 working days to settle international payments.
Automatic FIRA: InfinityApp gives you a free FIRA instantly after every successful transaction. This helps you stay compliant with RBI’s FEMA regulations.
Multi-currency account: InfinityApp gives you access to a multi-currency account after you sign up. This helps you receive payments in 50+ currencies across the globe.
So whether you are an exporter, freelancer, or a startup founder, Infinity ensures that your every foreign inward remittance is not only fast and cheap, but also compliant-friendly. Every international payment with Infinity arrives with a compliance document- FIRA, which helps you stay audit-ready and stress-free.
Ready to simplify international payments and compliance? Check out InfinityApp today.
FAQs about FIRC
What is e-FIRC?
e-FIRC is an electronic version of FIRC. FIRC is generated by banks when they receive foreign inward remittances. FIRC is a proof of international payments received and helps with various use cases like GST refunds, claiming incentives for exporters.
Is FIRC mandatory for all inward remittances in India?
Yes. FIRC is mandatory for all commercial transactions. For personal inward remittances it is not mandatory but its good to request for an FIRC as a proof of payment
How can i get an FIRC certificate?
You can receive an FIRC certificate by requesting the dealing bank to issue one after you have successfully received the payment. InfinityApp makes this process seamless by automatically generating a FIRA after every successful transaction.
