Millions of Indians freelancers, exporters, students, small business owners are discovering that their bank transfers, payment apps and online transactions are quietly controlled by decisions made in Washington, Brussels and Moscow. Here is what is actually happening, and why nobody told you sooner.
Imagine this. You are a software developer in Bengaluru. You have just delivered a project for a US-based client. The invoice is ready, the work is done, and your client hits “send” on a wire transfer from New York. You wait a day. Then two. Then five. The money does not arrive. Your bank says there is a “compliance hold.” The reason? Nobody tells you clearly. You call the client. They say the payment went out. You call your bank. They say they are investigating. Two weeks later, after multiple follow-up calls and emails, the money quietly lands in your account with a chunk missing in fees, and no explanation for the delay.
This is not a rare story. It is the everyday reality for a growing number of Indians who depend on international money flows and the cause is something most of them have never heard of: geopolitics quietly rewiring the global payment system.
The invisible layer under every bank transfer
When you send or receive money internationally, it does not travel directly from one bank to another the way a text message does. It passes through a chain of correspondent banks and intermediary banks that hold accounts for each other and pass money along. A payment from the US to India might route through a bank in New York, then a clearing bank in London or Singapore, before finally reaching your Indian bank.
This entire chain runs on a messaging network called SWIFT the Society for Worldwide Interbank Financial Telecommunication, a Belgium-based cooperative that connects over 11,500 financial institutions in more than 200 countries. SWIFT does not move money itself. It sends the instructions. But without those instructions, the money does not move at all.
India is the world’s largest recipient of foreign remittances, receiving between $129 billion (World Bank) and $137 billion (IOM, World Migration Report 2026) in 2024 almost double that of Mexico, the second-highest recipient. Millions of Indians from IT professionals to blue-collar workers abroad depend on this system working smoothly. When it doesn’t, entire households feel it.
For decades, this system worked quietly and efficiently for most people. Then geopolitics entered the picture and the payment system became a battlefield.
When a Bengaluru company’s bank account froze overnight
In October 2024, the US Treasury’s Office of Foreign Assets Control known as OFAC, the American government body that enforces financial sanctions sanctioned 19 Indian private sector companies and two Indian individuals. The charge: facilitating the shipment of technology and electronics to Russia in violation of US sanctions related to the war in Ukraine.
One of those companies was Emsystech, based in Bengaluru. According to the US Treasury Department’s own press release, the company had sent over 800 shipments of electronic components including integrated circuits and tantalum capacitors to Russian entities. It was designated under Executive Order 14024, which targets persons operating in the Russian technology sector.
The consequence was immediate and severe. Emsystech faced asset freezes and was banned from any transaction connected to the US financial system. Since almost all international dollar transactions touch the US system at some point through correspondent banks, dollar clearing, or SWIFT this effectively meant being cut off from global commerce. Banking restrictions followed. Access to US dollar transactions was lost entirely, severely disrupting its operations.
The critical detail here is this: Emsystech did not need to have a US bank account or US customers to be affected. The reach of US sanctions extends to any company anywhere in the world that transacts in US dollars or works with US-connected banks which is nearly everyone.
“The US could use secondary sanctions to put pressure on India to stop its activities with Russia or risk being cut off from the US financial system.” R. Andrew Gómez, Managing Consultant, Lipis Advisors
The freelancer’s hidden risk
You do not need to be exporting electronics to Russia to feel this. Even ordinary freelancers in India are navigating a system that has become far more complicated than it appears.
Most banks in India HDFC, ICICI, Axis, SBI support international remittance through SWIFT. But when a payment travels through the SWIFT correspondent banking chain, each intermediary bank performs its own compliance screening. If a client’s bank, or any bank along the route, flags a transaction for any reason, a name match on a sanctions list, a country linked to a high-risk corridor, an unusual transaction pattern the payment can be held, delayed, or in some cases returned without explanation.
Freelancers report that cross-border transfers through traditional SWIFT routes can take up to five business days, with fees deducted by multiple intermediary banks along the way. For those relying on timely payments to cover rent, EMIs, or monthly expenses, these delays cause real financial stress. In serious cases, non-compliance with foreign remittance documentation requirements can trigger account freezes, something many freelancers discover only after it has already happened.
5 days How long a SWIFT transfer can take to reach an Indian bank account 5–10% Fees lost on earnings through traditional bank remittance routes 80% Of cross-border transaction time is spent in the last mile, after a payment leaves the Swift network SWIFT Spotlight on Speed research, September 2025
The canadian mobile coffee stand that explains everything
Here is a case that illustrates how far this reaches even when you have done nothing wrong, broken no law, and are operating a perfectly legal business.
A Toronto mobile coffee stand selling Cuban coffee had its transactions blocked not by the Canadian government, which had no problem with the business, but by its US payment processor, Square Canada, which used US bank JPMorgan Chase to process payments. JPMorgan applied US embargo rules on Cuba to a Canadian seller. The business broke no Canadian law. It didn’t matter. The payment processor operated under US rules, and US rules said Cuba was off-limits. The coffee stand paid the price.
This is the new reality of global payments: the rules of the most powerful country’s financial system apply to you, even if you are not in that country and have not agreed to be governed by it.
India’s own response: Building an exit route
The Indian government has been watching this closely. When Russia was disconnected from SWIFT after its invasion of Ukraine in 2022, India which buys roughly 35% of its crude oil from Russia needed to find alternative payment routes fast. The solution was a mixture of rupee-vostro accounts (where Russian banks hold rupees in Indian bank accounts), dirham-based settlements routed through UAE banks, and the Russian SPFS messaging system as a SWIFT alternative.
Reliance Industries and BPCL used dirhams to settle oil transactions. Bank of Baroda and Axis Bank processed dirham payments. State Bank of India used its nostro account in Russia for ruble settlements. It was a patchwork of workarounds effective, but fragile.
Longer term, the Reserve Bank of India has been exploring whether its own domestic payment messaging system called SFMS, the Structured Financial Messaging System — could be expanded internationally, giving India a payment backbone that is not dependent on SWIFT or the US dollar system. The RBI has explicitly flagged geopolitical tensions as a key risk to cross-border payments in its Payments System Report, cautioning that “sanctions, restrictions on financial systems or currencies, and other operational barriers can disrupt markets and access.”
If you are a freelancer receiving dollars from abroad, a student paying university fees overseas, a small exporter settling invoices, or a family receiving remittances you are already inside this system. You may not feel it today. But the system you depend on is no longer politically neutral, and has not been for some time.
The practical takeaways are simple. Traditional SWIFT bank transfers are slower, more expensive, and more politically exposed than most people realise. Fintech platforms Wise, Skydo, Payoneer, Karbon offer faster settlement, lower fees, and less exposure to the correspondent banking chain, making them increasingly popular with Indian freelancers and small businesses. Diversifying payment methods is no longer just a convenience choice; it is becoming a form of financial resilience.
But the bigger question is one that no app can answer. When the global payment system is being quietly reshaped by geopolitical decisions made in Washington, Brussels, Beijing and Moscow, who is protecting the interests of the Indian freelancer, the small exporter, the student sending tuition abroad?
For now, the honest answer is: mostly nobody. You navigate it yourself, one failed transaction at a time.
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