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I have really high hopes from this. There is currently no good way for a SaaS startup in India to get money from international customers. I think this is why ma

I have really high hopes from this. There is currently no good way for a SaaS startup in India to get money from international customers. I think this is why many are forced to incorporate in the US/Singapore/etc. I am a single founder working on a SaaS project and receiving payments from outside India is one of the biggest challenges for me. I do not want to raise funds but may have to got that route just so that I can incorporate outside India and start receiving payments. I have three requests for Stripe: 1) I hope that Stripe does not come out with a limited version for India, and that it is possible to charge international customers a variable amount every month, like you can do in the US. 2) I also hope that they come up with a prompt way of issuing FIRCs for every payment received. Without an FIRC there is no way to prove that the transaction was an export and therefore you have to pay GST on it, which is normally 18% for services. This reason alone is pushing me to incorporate in some other country. I stand to lose thousands of dollars this year because I can't get an FIRC for the payments I receive via Paypal/Wire transfer/Transferwise. Paypal and Transferwise have procedures to get FIRCs, but when you approach their banks they either don't respond or come up with hundred reasons to not issue one. Citibank absolutely sucks at this. I really hope that Stripe just charges me whatever they want and couriers the FIRCs to my address automatically. 3) I hope that Stripe has a legal setup that is compatible with RBI regulations regarding the filling up of SOFTEX forms. There are some restrictions which in my understanding prohibit Indians from using international gateways like fastspring.

sudhirj 9y ago
How does paddle.com handle this? They take over as merchant of record, and so technically they're selling your SaaS and paying you royalties via a reverse invoice. Any idea if they need to or give our FIRCs?
- danieltillett 9y ago
  Are you suggesting that paddle.com gets around the RBI restrictions for companies based outside of India selling to Indians?
  - sudhirj 9y ago
    Not really - they're a London based company, and they follow whatever laws are applicable in the country of each customer (EU gets VAT, India gets GST, US gets nothing), etc. If I work with them, the idea is that I've sold my product to them, so I'm exporting it to a company in London. I'll need to either pay or get exemptions for my taxes based on export rules. They re-sell it worldwide and handle whatever country specific rules are prevalent in each country, but that's not my problem any more.
kumrr 9y ago
Have you tried using fastspring? Its expensive but seems to allow serving both indian and other country cards. Also if u open a export account (forgot what its called, but basically an account with an indian bank where u can deposit in $ or any specified currency), then fastspring can deposit the money there. You can then transfer it to ur rupee checking account at anytime and dont think u need any FIRC there. This is what we did a few years back for my startup (based in India), but not sure if things have changed recently.
- shripadk 9y ago
  > forgot what its called, but basically an account with an indian bank where u can deposit in $ or any specified currency You mean an EEFC account?
  - kumrr 9y ago
    Yes. Thats the one :) Thanks
shripadk 9y ago
> 3) I hope that Stripe has a legal setup that is compatible with RBI regulations regarding the filling up of SOFTEX forms. There are some restrictions which in my understanding prohibit Indians from using international gateways like fastspring. What exactly are the restrictions? Curious to know as I was planning to use FastSpring until Stripe made the announcement. The bigger problem is the strict RBI regulations. Especially when dealing with FIRC/e-BRC and filing of SOFTEX forms. I don't understand why these forms are even required to be filed as everything is recorded electronically (bank wire transfers and other modes of transfer: NEFT/RTGS/IMPS). It's almost like the RBI doubts the intentions of Software Exporters. > Paypal and Transferwise have procedures to get FIRCs, but when you approach their banks they either don't respond or come up with hundred reasons to not issue one. Citibank absolutely sucks at this. I really hope that Stripe just charges me whatever they want and couriers the FIRCs to my address automatically. The thing is that Citibank doesn't provide FIRC (unless you receive an FDI). It instead provides "FIRC Advise". The Authorized Dealer (the Bank you hold your Current Account in) has to issue you the FIRC based on the FIRC Advise provided by CitiBank. But the AD Bank will insist on getting a NOC (No-Objection Certificate) first! So it's a long drawn out process! And once the FIRC is issued, getting eBRC from the AD Bank is another headache (as you guessed, it requires certified SOFTEX). I just don't get the reason for all these ridiculous regulations. The real problem, I guess, lies in the fact that RBI is treating all Software Exports similar to exports for other Goods/Services. Purchase Orders are needed as proof for certification of SOFTEX forms when you and I both know that in SaaS or other software product sales there is no necessity for a PO (unless a big corporate wants to purchase in bulk) for export to take place. Also, please sign these petitions: 1. https://www.change.org/p/finance-ministry-of-india-rationalize-paypal-payoneer-rules-regulations-for-india https://www.change.org/p/finance-ministry-of-india-rationali... 2. https://www.change.org/p/shri-arun-jaitley-finance-minister-of-india-please-relax-gst-export-norms-for-small-freelancers-and-bloggers https://www.change.org/p/shri-arun-jaitley-finance-minister-... and if possible, do spread the word!
- temp9910 9y ago
  > What exactly are the restrictions? Curious to know as I was planning to use FastSpring until Stripe made the announcement. Honestly I don't remember perfectly, but here is what I think: the relationship between Fastspring and you is that of a payment processor. If you go through the Softex regulations and RBI regulations for payment processors, at some point there is a requirement that the payment processor must have a bank account with an Indian bank overseas. The money must be routed through this Indian bank's overseas branch. This is the only allowed way to receive money from payment processors for exports. Obviously, Fastspring is not obliged to carry out business this way and they probably route money through a bank account of the country they are established in. The workaround is to say that Fastspring is not your payment processor but your client, and then raise invoices against Fastspring for the amounts you receive from them, and declare those in SOFTEX. So instead of 1000 transactions of $10 towards a thousand customers, you show a single transaction of $10,000 towards Fastspring. But this approach seems wrong on so many levels. For one, you may end up raising those thousand invoices and mailing them to your customers anyways even if you don't account for them internally. Secondly, I think the wording of the contract between Fastspring and suggests that of a payment processor, and you are the entity liable towards those 1000 customers, not Fastspring. One could also say that you are Fastspring's customer and you are importing their payment processing services, and so even after complying with other regulations, you need to pay reverse GST of 18% on their commission as import of services if they are not paying the same. Saying all that, I am a programmer and hate to wear the legal/accountant hat. But this is just what I could make out. > The thing is that Citibank doesn't provide FIRC (unless you receive an FDI). It instead provides "FIRC Advise". The Authorized Dealer (the Bank you hold your Current Account in) has to issue you the FIRC based on the FIRC Advise provided by CitiBank. But the AD Bank will insist on getting a NOC (No-Objection Certificate) first! So it's a long drawn out process! And once the FIRC is issued, getting eBRC from the AD Bank is another headache (as you guessed, it requires certified SOFTEX). So many acronyms! Way too complex for me. But thanks for clarifying and connecting the dots for me. I think I finally understand the process. However, in my experience, every bank I have dealt with has shown me circular SPL-09/2016 from FEDAI [0] that unconditionally says that " FIRC may be issued only for inward remittances covering FDI/FII." So they will not issue an FIRC no matter what, even if you take the SOFTEX out of equation. SOFTEX only compounds the difficulty. I am convinced that none of the banks are going to issue me an FIRC no matter what letter or document I show to them. I can't even get an FIRC or an eBRC for a wire transfer. I have personally given up. I will wait for the government to rationalise the SOFTEX requirements and bring back the $20k transaction threshold below which you did not need to file SOFTEX, and somehow make the FIRC process automatic. Till then I am just paying the 18% GST which I should not have to, and classifying my services as "other engineering services" to avoid SOFTEX. I haven't registered with any STPI for SOFTEX yet. I will sign the petitions you shared. [0]: https://www.icicibank.com/managed-assets/docs/business/FEDAI-circular-SPL-092016.pdf https://www.icicibank.com/managed-assets/docs/business/FEDAI...

sudhirj 9y ago

How does paddle.com handle this? They take over as merchant of record, and so technically they're selling your SaaS and paying you royalties via a reverse invoice. Any idea if they need to or give our FIRCs?

danieltillett 9y ago
Are you suggesting that paddle.com gets around the RBI restrictions for companies based outside of India selling to Indians?
- sudhirj 9y ago
  Not really - they're a London based company, and they follow whatever laws are applicable in the country of each customer (EU gets VAT, India gets GST, US gets nothing), etc. If I work with them, the idea is that I've sold my product to them, so I'm exporting it to a company in London. I'll need to either pay or get exemptions for my taxes based on export rules. They re-sell it worldwide and handle whatever country specific rules are prevalent in each country, but that's not my problem any more.

kumrr 9y ago

Have you tried using fastspring? Its expensive but seems to allow serving both indian and other country cards. Also if u open a export account (forgot what its called, but basically an account with an indian bank where u can deposit in $ or any specified currency), then fastspring can deposit the money there. You can then transfer it to ur rupee checking account at anytime and dont think u need any FIRC there. This is what we did a few years back for my startup (based in India), but not sure if things have changed recently.

shripadk 9y ago
> forgot what its called, but basically an account with an indian bank where u can deposit in $ or any specified currency You mean an EEFC account?
- kumrr 9y ago
  Yes. Thats the one :) Thanks

shripadk 9y ago

> 3) I hope that Stripe has a legal setup that is compatible with RBI regulations regarding the filling up of SOFTEX forms. There are some restrictions which in my understanding prohibit Indians from using international gateways like fastspring. What exactly are the restrictions? Curious to know as I was planning to use FastSpring until Stripe made the announcement. The bigger problem is the strict RBI regulations. Especially when dealing with FIRC/e-BRC and filing of SOFTEX forms. I don't understand why these forms are even required to be filed as everything is recorded electronically (bank wire transfers and other modes of transfer: NEFT/RTGS/IMPS). It's almost like the RBI doubts the intentions of Software Exporters. > Paypal and Transferwise have procedures to get FIRCs, but when you approach their banks they either don't respond or come up with hundred reasons to not issue one. Citibank absolutely sucks at this. I really hope that Stripe just charges me whatever they want and couriers the FIRCs to my address automatically. The thing is that Citibank doesn't provide FIRC (unless you receive an FDI). It instead provides "FIRC Advise". The Authorized Dealer (the Bank you hold your Current Account in) has to issue you the FIRC based on the FIRC Advise provided by CitiBank. But the AD Bank will insist on getting a NOC (No-Objection Certificate) first! So it's a long drawn out process! And once the FIRC is issued, getting eBRC from the AD Bank is another headache (as you guessed, it requires certified SOFTEX). I just don't get the reason for all these ridiculous regulations. The real problem, I guess, lies in the fact that RBI is treating all Software Exports similar to exports for other Goods/Services. Purchase Orders are needed as proof for certification of SOFTEX forms when you and I both know that in SaaS or other software product sales there is no necessity for a PO (unless a big corporate wants to purchase in bulk) for export to take place. Also, please sign these petitions: 1. https://www.change.org/p/finance-ministry-of-india-rationalize-paypal-payoneer-rules-regulations-for-india https://www.change.org/p/finance-ministry-of-india-rationali... 2. https://www.change.org/p/shri-arun-jaitley-finance-minister-of-india-please-relax-gst-export-norms-for-small-freelancers-and-bloggers https://www.change.org/p/shri-arun-jaitley-finance-minister-... and if possible, do spread the word!

temp9910 9y ago
> What exactly are the restrictions? Curious to know as I was planning to use FastSpring until Stripe made the announcement. Honestly I don't remember perfectly, but here is what I think: the relationship between Fastspring and you is that of a payment processor. If you go through the Softex regulations and RBI regulations for payment processors, at some point there is a requirement that the payment processor must have a bank account with an Indian bank overseas. The money must be routed through this Indian bank's overseas branch. This is the only allowed way to receive money from payment processors for exports. Obviously, Fastspring is not obliged to carry out business this way and they probably route money through a bank account of the country they are established in. The workaround is to say that Fastspring is not your payment processor but your client, and then raise invoices against Fastspring for the amounts you receive from them, and declare those in SOFTEX. So instead of 1000 transactions of $10 towards a thousand customers, you show a single transaction of $10,000 towards Fastspring. But this approach seems wrong on so many levels. For one, you may end up raising those thousand invoices and mailing them to your customers anyways even if you don't account for them internally. Secondly, I think the wording of the contract between Fastspring and suggests that of a payment processor, and you are the entity liable towards those 1000 customers, not Fastspring. One could also say that you are Fastspring's customer and you are importing their payment processing services, and so even after complying with other regulations, you need to pay reverse GST of 18% on their commission as import of services if they are not paying the same. Saying all that, I am a programmer and hate to wear the legal/accountant hat. But this is just what I could make out. > The thing is that Citibank doesn't provide FIRC (unless you receive an FDI). It instead provides "FIRC Advise". The Authorized Dealer (the Bank you hold your Current Account in) has to issue you the FIRC based on the FIRC Advise provided by CitiBank. But the AD Bank will insist on getting a NOC (No-Objection Certificate) first! So it's a long drawn out process! And once the FIRC is issued, getting eBRC from the AD Bank is another headache (as you guessed, it requires certified SOFTEX). So many acronyms! Way too complex for me. But thanks for clarifying and connecting the dots for me. I think I finally understand the process. However, in my experience, every bank I have dealt with has shown me circular SPL-09/2016 from FEDAI [0] that unconditionally says that " FIRC may be issued only for inward remittances covering FDI/FII." So they will not issue an FIRC no matter what, even if you take the SOFTEX out of equation. SOFTEX only compounds the difficulty. I am convinced that none of the banks are going to issue me an FIRC no matter what letter or document I show to them. I can't even get an FIRC or an eBRC for a wire transfer. I have personally given up. I will wait for the government to rationalise the SOFTEX requirements and bring back the $20k transaction threshold below which you did not need to file SOFTEX, and somehow make the FIRC process automatic. Till then I am just paying the 18% GST which I should not have to, and classifying my services as "other engineering services" to avoid SOFTEX. I haven't registered with any STPI for SOFTEX yet. I will sign the petitions you shared. [0]: https://www.icicibank.com/managed-assets/docs/business/FEDAI-circular-SPL-092016.pdf https://www.icicibank.com/managed-assets/docs/business/FEDAI...