When one door closes, another opens—and for Indian entrepreneurs facing Stripe's recent changes, a US LLC could be that new opportunity.
Navigating international payment regulations is never easy, and Stripe’s decision to move to an invite-only model in India may have left you searching for alternatives.
By establishing a US LLC, you can streamline compliance and gain full access to Stripe’s services on a global scale. But more importantly, this move opens doors to broader opportunities—what will you achieve with this new advantage?
Stripe’s shift to an invite-only model in India stems from the country’s increasingly complex regulatory landscape. With evolving compliance requirements, particularly around Know Your Customer (KYC) norms, Stripe needed to adapt. By limiting access, Stripe can better manage risks related to onboarding new users, ensuring that only thoroughly vetted businesses can join. This shift reduces the likelihood of non-compliance, allowing Stripe to continue providing reliable service.
Though this approach may restrict access for some businesses, it’s a strategic move to uphold Stripe’s commitment to security and regulatory compliance in India. However, for entrepreneurs looking for broader access and flexibility, setting up a US LLC offers a seamless way to tap into Stripe’s global services.
If you're already using Stripe in India, there’s no need to worry—your account remains unaffected by the invite-only change. You can continue managing transactions, accessing customer support, and using the platform as you always have, without any disruptions. This new policy only applies to new users looking to sign up, who will now need to request an invite.
For Indian entrepreneurs, Stripe’s services in India are limited, restricting international payments and global market access. Forming a US-based entity, like a US LLC, solves this issue by allowing access to Stripe USA, enabling unrestricted payment processing. This setup streamlines serving global customers and expanding revenue opportunities, free from Stripe India’s constraints.
By forming a US LLC, you unlock the ability to use Stripe without restrictions, gaining access to simplified payment processing and a broader customer base. This setup makes cross-border transactions smoother and allows you to grow internationally without the heavy burden of local regulatory constraints.
A US LLC also provides a stable, business-friendly framework, enabling you to focus on growth rather than compliance issues. For Indian entrepreneurs, particularly those in e-commerce or offering services to a global audience, forming a US LLC brings significant benefits of LLCs, such as limited liability protection, flexible management structures, and ease of registration. Additionally, with proper structuring, it can potentially be made tax-free for foreign owners. This setup also grants access to Stripe’s full suite of services and the lucrative US market, offering immense potential for expansion and scaling globally.
By setting up a US LLC, Indian entrepreneurs can apply as a business on Stripe USA instead of being restricted to Stripe India. This allows you to process international payments seamlessly through Stripe's US platform, giving your business access to a larger customer base and increased revenue opportunities. Once you have a US LLC, the process to register for Stripe USA is straightforward, enabling you to bypass some of the limitations of Stripe India, such as restricted access to certain services and currencies.
This move provides several advantages, including access to Stripe’s superior payment processing system, enhanced credibility in the US market, and potential tax benefits. Additionally, a US LLC offers more flexible options for global transactions, making it a highly effective tool for businesses looking to expand internationally.
Before taking the leap, it’s essential to understand the tax implications and compliance requirements for non-resident LLCs. By structuring your business appropriately, you can minimize tax liabilities while maximizing profits, making global expansion a more attainable goal for Indian entrepreneurs.
For Indian entrepreneurs who already have an established business in India, structuring your US LLC under your Indian company can create a streamlined, tax-efficient path to expanding your global presence. One significant benefit of this approach is the potential to take advantage of the US-India tax treaty, which helps you avoid double taxation and keeps your compliance costs low.
In this arrangement, as long as your US LLC does not establish a "permanent establishment" (PE) in the United States—such as maintaining a physical office or significant on-the-ground operations—the income from the LLC can generally pass through to the Indian company without triggering federal taxes in the US. This streamlined tax treatment makes it easier to manage your business while staying compliant with international tax regulations.
This pass-through structure simplifies the tax process, allowing Indian entrepreneurs to maintain a presence in the US market without the complexities of filing corporate taxes in both countries. It also makes the US LLC easier to manage from a regulatory standpoint, with fewer reporting obligations and lower overall costs.
This kind of ownership structure is ideal for entrepreneurs looking to operate globally while maintaining efficient tax and compliance strategies. Whether your Indian company is in e-commerce, technology, or services, this structure allows you to tap into the vast opportunities of the US market with minimal overhead, all while continuing to leverage the advantages of your business’s home base in India.
Setting up US Stripe through a US LLC offers Indian entrepreneurs a wealth of opportunities to expand their business globally and simplify payment processing.
Here are the key benefits:
For domestic sales, Razorpay offers a comprehensive solution tailored to the Indian market. Razorpay allows you to accept, process, and disburse payments through various modes like credit cards, debit cards, net banking, UPI, and popular digital wallets, making it a versatile option for Indian businesses.
Razorpay’s seamless payment integration simplifies your ecommerce operations by offering a unified dashboard to manage both online and offline transactions. Its user-friendly platform improves conversion rates while mitigating fraud, which is why over 5 million businesses trust Razorpay for their payment needs.
Leveraging both US Stripe and Razorpay offers Indian entrepreneurs a powerful payment strategy for business growth. This combination allows you to navigate the complexities of cross-border payments while ensuring compliance and smooth transactions.
With US Stripe, you can tap into global markets, accepting international payments in over 135 currencies. Meanwhile, Razorpay provides a reliable gateway for domestic sales in India, giving you the flexibility to serve both local and international customers seamlessly.
By integrating these two payment platforms, you create a scalable payment infrastructure that supports business expansion. Fintech advancements make managing payments easier than ever, and this strategic blend capitalizes on the strengths of both solutions. With a secure, efficient payment setup, you can focus on growing your business and stay ahead of the competition by adapting to evolving market conditions and regulatory changes.
Stripe’s future in India is set for significant evolution, with upcoming changes aimed at improving services for businesses with international expansion plans. However, as Stripe adopts an invite-only model within India, entrepreneurs may find that setting up a US Stripe account through a US LLC becomes a more practical and efficient solution. By leveraging a US LLC, Indian businesses can bypass some of the regulatory challenges in India, gain full access to Stripe’s services, and streamline cross-border trade. This approach not only offers enhanced financial tools but also opens the door to the lucrative US market, providing more flexibility and growth potential for businesses looking to scale globally.
You won't be affected immediately, as existing Stripe accounts in India will continue to be supported, but considering invite-only implications, you'll need to adapt to alternative payment solutions and compliance challenges to guarantee business continuity.
No, Indian entrepreneurs cannot use US Stripe without a US business entity. Stripe requires businesses to have a legal presence in the country they are registering in. To access Stripe’s services in the US, you need to establish a US-based business entity, such as a Limited Liability Company (LLC) or Corporation, and have a US bank account.
No, Indian businesses cannot use Stripe for domestic sales within India. Stripe has moved to an invite-only model in India as of May 2024, limiting its services for new users and focusing on international transactions. While existing Stripe accounts in India will continue to be supported, Stripe is primarily positioned for global payments. For domestic sales within India, businesses typically rely on Indian payment gateways like Razorpay, which are designed to handle local currency transactions and regulatory requirements specific to India.
Yes, Stripe’s invite-only policy will affect Indian businesses looking to accept international payments. Starting in May 2024, new accounts will require an invite, with priority given to businesses focused on international expansion. Existing accounts remain supported, but new businesses may need to set up a US entity, like an LLC, to fully access Stripe’s services for global payments.
Kathleen Schweitzer is an international taxation expert, providing strategic counsel to businesses with complex compliance, tax and financial issues in an effort to help them grow their business globally. She often gives lecture on U.S. tax developments, transfer pricing, taxes on the sale of goods and services, U.S. tax policy development, taxation of internet commerce and multi-jurisdictional global tax planning. Kathleen enjoys reading, photography, cooking and spending time with her husband and eleven-year-old daughter.
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