Transforming Financial Services in IFSC

overview

• The International Financial Services Centres Authority (IFSCA) rolled out key regulatory updates aimed at enhancing transparency, governance, and global competitiveness within GIFT City IFSC.
• These cover revised guidelines for finance companies, a new framework for Global/Regional Corporate Treasury Centres (GRCTCs), important amendments to the Ship Leasing Framework, and strengthened governance norms for treasury entities.

Corporate Governance for Finance Companies/ GRCTC Entities

• The new regulations mandate the formation of key board committees, including Audit, Nomination & Remuneration, and Risk Committees.
• The appointment of independent directors is now compulsory, along with CEO/CFO certification of financial statements.
• Companies are also required to disclose related party transactions and credit exposures.
• Additionally, having a designated Compliance Officer and a whistle-blower policy is mandatory.

Ship Leasing Framework Revised

• Lessors can now raise invoices and receive payments in any foreign currency permitted under the IFSCA (Banking) Regulations, 2020.
• Additionally, they are allowed to open SNRR accounts with authorized dealers outside IFSC under FEMA 2016 for business transactions.
• The framework also restricts ship leasing transactions that involve transferring ownership or lease rights from Indian residents to IFSC entities solely for serving Indian residents—except in cases where the ship is newly acquired from an Indian shipyard.

GRCTC Framework for Treasury Operations

• IFSCA’s GRCTC framework allows entities in IFSC to handle global treasury functions like intra-group financing, FX management, and cash pooling.
• GRCTCs must be registered as Finance Companies and are permitted to conduct transactions in any foreign currency.
• They are also required to follow prudential and governance norms, including arm’s length principles.
• This initiative is aimed at positioning IFSC as a leading hub for global treasury operations.

conclusion

• These regulatory developments reflect IFSCA’s continued efforts to build a world-class financial ecosystem in GIFT City—anchored in global best practices, strong governance, and operational flexibility.
• Entities operating or planning to set up in IFSC should align early with these changes to fully leverage emerging opportunities and ensure smooth compliance.