A quiet shift is taking shape in how Indians overseas send money home. A growing number of workers are experimenting with stablecoins such as Tether’s USDT instead of traditional bank transfers, drawn by faster settlements and a better exchange rate.
The trend, which has been building over the past couple of months, is driven by a clear incentive. While the rupee trades at around ₹88.6 to the US dollar, USDT sells in India at a premium of about 4–5%, hovering near ₹93. That means a worker sending $1,000 through a regular bank channel would see ₹88,600 reach home, while the same amount sent via USDT could fetch over ₹93,000 — a difference large enough to tempt both senders and intermediaries.
Money changers in the UAE, the US and elsewhere appear to have spotted the opportunity. Instead of using bank networks, they buy USDT, transfer it to partners in India, and settle transactions through peer-to-peer deals or local exchanges. The setup lets both sides earn a little extra, while customers receive a slightly larger sum. Transfers are quicker and cheaper too, though regulators are unlikely to approve of the practice.
Market participants estimate that around 3–4% of India’s remittance flow has shifted from banks to stablecoins. Though still small, it signals how crypto is quietly finding practical use cases in everyday financial flows. “Money transmitters in a few jurisdictions are now allowed to handle remittance in fiat currency as well as in cryptos, including stablecoins,” said Purushottam Anand, advocate and founder of Crypto Legal. “A company having a Money Transmission Licence in the US can accept USD, convert it into stablecoin and send it to the digital wallet of the beneficiary in India.”
The trend also coincides with rising demand for USDT within India. Traders are using it to hedge against market volatility, while offshore gaming platforms rely on it for real-money transactions. That steady demand has kept the premium high, fuelling further inflows from abroad.
However, regulators remain cautious. The Reserve Bank of India (RBI) has maintained its preference for centralised solutions like the proposed central bank digital currency (CBDC) for cross-border transactions. The RBI and the UAE central bank are reportedly exploring mechanisms that could enable CBDC-based transfers between the rupee and dirham.
Despite those plans, private operators are already testing the waters. A Bengaluru-based firm recently announced intentions to issue an INR-backed stablecoin, which could make remittances even more fluid if listed on overseas exchanges. Sources say some service export payments, which fall outside official monitoring systems, are already settling in stablecoins.
For now, the sums remain small and the practice sits in a regulatory grey zone. Yet it highlights a growing appetite for faster, cheaper and more rewarding cross-border transfers — and a subtle shift in how India’s vast remittance economy might evolve in the digital age
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