At Ebizfiling, we help businesses understand GST rules in simple language. Many payment gateways now deal with cross-border users and digital service flows. These operating models can trigger OIDAR rules and directly impact GST status. Fintech tools and forex platforms must review their position early to avoid notices, penalties, or tax gaps later.
The GST law defines OIDAR as digital services delivered online with minimal physical contact. After the 2023 change, the law removed the phrase related to automation. This widened the scope and covered more fintech tools that operate through dashboards, APIs, and automated payment flows. Payment gateways handle recurring billing, currency conversion, card token systems, settlement dashboards, wallet movement, and verification tools. All these features fall under services delivered online. If the user is in India, the place of supply becomes India. This is why payment gateways must now review whether they fall under OIDAR.
Foreign fintech operators that serve Indian users do not get turnover exemption. GST applies from the first rupee of revenue. They must register under the simplified scheme on www.gst.gov.in and file GSTR 5A each month.Forex platforms also fall under this rule when they offer online currency tools, conversion engines, or algorithm driven systems. Even advisory dashboards or rate comparison tools may fall under OIDAR if they are delivered online through automated panels.
OIDAR applies to any service that users access online, relies on internet delivery, does not involve any physical component, and is consumed by an Indian recipient. Most fintech tools fit this definition because they operate through online settlement reports, currency conversion dashboards, automated payment routing flows, API based verification systems, and cloud ledger tools. These features show that the service is delivered digitally, which meets the OIDAR test for place of supply. As a result, payment gateways and forex platforms that serve Indian users must review their GST registration needs and update their compliance process accordingly.
To avoid risk, fintech companies should use a clear approach.
Step 1: Identify all digital services
List all online features. Note which actions rely on automation, API, cloud, or dashboard access.
Step 2: Determine Indian users
Check how many users, merchants, or clients operate from India. Even one paying user can trigger GST.
Step 3: Check if the provider is foreign
Foreign entities supplying OIDAR services to India must register under Form GST REG 10 through www.gst.gov.in.
Step 4: Check tax responsibility
For B2C users the foreign provider must collect IGST at 18 percent.
For B2B users, the recipient pays under reverse charge, but the foreign provider must still issue correct invoices.
Step 5: File monthly returns
Foreign OIDAR suppliers must file GSTR 5A. This return reports all inward supplies to Indian recipients.
|
Category |
India Based Provider |
Foreign Provider |
|
User Type |
B2B or B2C |
B2B or B2C |
|
GST Trigger |
Turnover above 20L |
First rupee of revenue |
|
Registration Form |
REG 01 |
REG 10 |
|
Return Type |
GSTR 1 and GSTR 3B |
GSTR 5A |
|
Tax Rate |
18 percent |
18 percent |
|
Collection Responsibility |
Provider |
Provider for B2C and reverse charge for B2B |
This table helps payment gateways understand how GST varies based on location and user type.
We review your fintech model and identify which services fall under OIDAR based on actual user flow and delivery mode.
We check your Indian user base and guide you on whether GST registration is needed, including REG 10 for foreign providers.
We map your service features with GST rules and help you understand tax responsibility for both B2B and B2C users.
We assist you with monthly compliance, including preparation and filing of GSTR 5A for foreign OIDAR suppliers.
We help you set up proper invoicing, IGST collection, and documentation so you avoid penalties and tax gaps.
We provide ongoing support so your payment gateway or forex platform stays compliant as your business scales.
Payment gateways and forex platforms must now review their GST status under OIDAR rules. The law expanded the OIDAR scope and placed tax responsibility on digital service providers. A correct recheck helps fintech tools stay compliant and avoid risk. Ebizfiling supports companies in understanding their GST position and meeting all compliance needs with clarity.
OIDAR Compliance Roadmap for Foreign Startups
All About the Key Features of OIDAR Services
GST Registration for OIDAR Service Providers in India
GST Registration for Special Economic Zone Units and Developers
Payment gateways offer digital services that reach Indian users. After the 2023 changes, more digital services fall under OIDAR, and reviewing applicability helps avoid incorrect GST positions.
Yes, forex platforms may fall under OIDAR because they use online dashboards, conversion tools, rate engines, and automated features accessed by Indian users.
No, server location does not affect OIDAR liability. GST depends on the location of the service recipient, and OIDAR applies if the user is located in India.
No, foreign OIDAR suppliers do not get any GST exemption. They must register under GST from the first rupee without any threshold limit.
A foreign OIDAR provider must file GSTR 5A every month on the GST portal and report all digital supplies made to Indian users.
For Indian GST-registered recipients, GST is paid under the reverse charge mechanism, though the foreign supplier must still issue proper invoices.
For B2C supplies, the foreign OIDAR provider must collect 18 percent IGST from Indian users and pay it to the government through GSTR 5A.
Non-compliance or wrong classification can lead to GST notices, penalties, and interest on unpaid tax, as authorities have increased scrutiny on foreign digital service providers.
No, after the 2023 amendments, the presence of human support does not remove OIDAR classification. The service is identified based on its automated delivery.
Ebizfiling helps fintech tools review GST applicability, assess OIDAR impact, handle REG-10 registration, file GSTR 5A, and maintain compliant GST records for Indian operations.
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