India and the European Union have concluded negotiations on financial services under the India–EU Free Trade Agreement, marking a major milestone in strengthening bilateral economic and strategic ties. The agreement was finalised during the latest round of negotiations held on January 6, 2026. India and the European Union share a strong commitment to deepening cooperation in financial services. In 2024, total services trade between the two stood at around USD 83 billion. India exported approximately USD 700 million worth of financial services to the EU, while imports from the bloc were valued at about USD 600 million. Against this backdrop, both sides have worked to develop a forward-looking and balanced framework that enhances market access, strengthens regulatory cooperation and supports deeper integration of their financial systems. The Financial Services Annex under the FTA represents a significant advancement over standard commitments under the General Agreement on Trade in Services, expanding into a comprehensive framework of 16 articles. It establishes an institutional and regulatory foundation to accelerate bilateral collaboration and unlock new opportunities for financial institutions and service providers on both sides. A key feature of the agreement is cooperation on electronic payments and real-time transaction infrastructure. India and the EU have committed to improving interoperability and interlinkages between payment systems, supporting faster and more convenient cross-border payments. This is expected to strengthen real-time remittances, merchant payments and other transfers, while supporting India’s digital payments ecosystem and creating opportunities for Indian payment service providers, including those leveraging platforms such as UPI. The annex also places strong emphasis on financial technology and regulatory innovation. Both sides have committed to enhanced cooperation in fintech, including areas such as supervisory technology, regulatory technology and central bank digital currencies. These provisions are seen as a major step for India in establishing structured fintech cooperation with a developed market, enabling regulatory learning, knowledge exchange and collaboration between Indian and European fintech firms. Provisions on credit rating and non-discrimination aim to ensure fair treatment for Indian financial institutions operating in the EU. The agreement seeks to prevent arbitrary or discriminatory regulatory practices, ensuring parity with domestic institutions and facilitating smoother market entry for Indian banks, insurers and other financial service providers. On market access and investment, the schedules of commitments reflect progressive liberalisation. India has offered enhanced foreign direct investment limits, including 100 per cent FDI in insurance and up to 74 per cent in banking. The agreement also includes a more liberal bank branch licensing regime, allowing up to 15 branches over a four-year period, compared with earlier limits under GATS. These measures position EU financial service providers to compete effectively in India’s expanding financial services market, while EU commitments are expected to support the expansion of Indian firms into European markets. At present, three Indian banks — State Bank of India, Bank of Baroda and Bank of India — operate a combined five branches in the EU, while State Bank of India maintains a representative office. From the European side, five banks operate 33 branches in India, and 17 maintain representative offices. Overall, the conclusion of financial services negotiations under the India–EU FTA underscores both sides’ intent to deepen economic engagement and capitalise on opportunities in a rapidly evolving financial landscape. By providing clearer market access, regulatory transparency and structured cooperation, the agreement is expected to catalyse greater bilateral investment, institutional presence and growth in cross-border financial services.