IFSC (Payment Services)(Amendment) Regulations, 2024
OVERVIEW:
The International Financial Services Centres Authority (IFSCA) has issued an important notification regarding the amendment of the International Financial Services Centres Authority (Payment Services) (Amendment) Regulations, 2024.
The amendment regulations are effective from April 2, 20224, upon their publication in the Official Gazette.
This amendment introduces changes to the regulations governing payment services within International Financial Service Centre (IFSC).
AIM OF THE AMENDMENT:
The amendment in International Financial Service Centres Authority (Payment Services) (Amendment) Regulation, 2024, aims to refine the existing framework for the payment services provided within IFSCs.
The amendment primarily focuses on the definition of “escrow service’ within regulation 2 of the principal Regulations.
WHAT DOES IT SAY?
An amendment has been made to regulation 2(1)(l) of International Financial Service Centres Authority (Payment Services) (Amendment) Regulation, 2024.
The definition of ‘escrow service’ has been broadened.
Under the amendment regulations, an ‘escrow service’ is defined as a service provided by a payment service provider, under an agreement, whereby money is held in an escrow account with an IFSC Banking Unit (IBU) or an IFSC Banking Company (IBC) for and on behalf of one or more parties involved in a transaction .
This definition clarifies the role and function of escrow services within IFSCs, providing a more precise framework for such services.
CONCLUSION:
The amendments in International Financial Service Centres Authority (Payment Services) (Amendment) Regulation, 2024, aim to address practical challenges faced by entities.
It is crucial for stakeholders operating within IFSCs to familiarize themselves with these amendments to ensure compliance with the updated regulatory framework governing payment services.
