Synopsis: India’s top brokerage platforms are entering global investing through GIFT City, opening a new growth opportunity as domestic brokerage earnings slow and investors look beyond Indian markets.
India has witnessed a giant surge in investments, with demat accounts rising from around 40 million in 2020 to over 190 million now. But very few investors are investing outside India at the moment.
This is a significant opportunity. With GIFT City making it easy for investors’ pursuit of global opportunities, these platforms can now offer international stocks and take their business beyond India.
How Will They Make Money?
Global investing is a game changer
- Platforms earn on currency exchange (roughly 0.5 percent to 1.5 percent)
- They impose a tax on international trade
- Investors are more likely to invest in the world
It could increase the total amount of money these companies make when a small percentage of users begin investing outside the country.
Why This Move Matters
Investors are shifting their strategy. Before, it was just about making returns. Today, more investors are considering spreading their money or diversifying their portfolio of investments.
This shift is important for these platforms. Without global investing, users may go to other platforms that offer it. And this move is about keeping users engaged and growing with them.
Risks
The biggest risk may come from investor psychology rather than regulation. Global investing could lead many first-time investors to buy companies they already know and use.
An iPhone user may instinctively buy Apple, a Tesla fan may prefer Tesla, and after the high-profile SpaceX IPO in 2026, many investors may be drawn toward such popular names simply because of brand appeal. This familiarity bias can lead to portfolios that appear global but remain concentrated in a few widely known stocks.
Alongside this, currency movements can impact returns by several percentage points annually, while any change in India’s USD 250,000 overseas investment limit could influence adoption. For brokerages, rising competition may gradually compress FX spreads and international trading fees, limiting long-term profitability.
Competition for Indian Listed Companies
It exerts indirect pressure on Indian markets and firms. If investors can invest globally, domestic companies will have to compete with world leaders for the same capital, not just local peers. This raises the bar for governance, transparency and quality of growth. Companies that don’t consistently deliver may see capital flow to better alternatives globally.
But the situation also presents an opportunity. It can help strong Indian companies benchmark themselves against global standards and attract better-informed, long-term investors. Over time, this competitive pressure can improve the overall quality of the market, making Indian equities more robust and comparable to the rest of the world.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing
