Inclusion of FC/FU as “Credit Institution” under The Credit Information Companies (Regulation) Act, 2005
The International Financial Services Centres Authority (IFSCA) has issued a circular (Circular No. F. No. 172/IFSCA/Finance Company Regulations/2023- 24/02) on January 5, 2024, outlining the permissible activities for Foreign Companies (FC) and Foreign Units (FU) operating as Credit Institutions. This circular provides guidance on the activities that these entities can engage in within the International Financial Services Centre (IFSC).
The International Financial Services Centres Authority (IFSCA) specifies That entities categorized as ‘Finance Company’ and ‘Finance Unit’ within the International Financial Services Centre (IFSC) are authorized to engage in the following permissible activities, operating as ‘credit institutions’:
(i) lending in the form of loans, commitments and guarantees, credit enhancement, securitisation, financial lease, and sale and purchase of portfolios, as specified in sub-clause (a) of clause (ii) of sub-regulation (1) of regulation 5 of the FC Regulations; Whereas clause (ii) specified the Permitted Core activities.
(ii) factoring and forfaiting of receivables, as specified in sub-clause (b) of clause (ii) of sub-regulation (1) of regulation 5 of the FC Regulations; Where as clause (ii) specified the Permitted Core activities.
(iii) all or any of the activities mentioned in sub-clause (i) and (ii) above, if carried out by a Finance Company/Finance Unit as a Global/Regional Corporate Treasury Centre, and;