IFSCA Invites Feedback on Enhanced Internet Banking Standards for IFSC Banking Units
- GIFT CFO
- Sep 23
- 3 min read
The International Financial Services Centres Authority (IFSCA) has released a public consultation paper on strengthening internet banking services with Internet Banking Standards for IFSC Banking Units in provided by International Banking Units (IBUs) operating in GIFT City. The consultation, dated 22nd September 2025, reflects the regulator’s forward-looking approach to ensure that digital banking services in India’s premier international financial hub match global benchmarks.
🔎 Background
In April 2024, IFSCA had issued a circular titled “Internet Banking Services to Clients of IBUs”. This framework outlined the basic standards and requirements for IBUs to provide online banking to their clients.
However, with digital finance evolving rapidly, IFSCA has now decided to review and refine the framework. The focus of this review is to:
Add specific compliance requirements
Enhance transparency, security, and efficiency
Ensure that services are customer-friendly and technologically robust
The consultation seeks feedback on three broad categories of internet banking services:
Information Services
Interactive Information Exchange Services
Transactional Services
💡 Key Proposals in the Draft Circular for Internet Banking Standards for IFSC Banking Units
1. Information Services
IBUs must go beyond just offering generic account information. The proposal requires:
Display of currencies offered for transactions and conversions.
Clear communication of cut-off timings for executing transactions, ensuring clients know settlement timelines upfront.
This will provide greater transparency and clarity to customers—especially for cross-border transactions where time zones and settlement dates can cause confusion.
2. Interactive Information Exchange Services
The new framework envisions a unified, digital-first customer experience. At minimum, IBUs will need to provide:
Real-time account balances across linked accounts.
Live FX conversion rates.
Downloadable account statements in structured, machine-readable formats (CSV, JSON, XML) with complete details like timestamps and transaction references.
The ability to provide instructions for inward remittances and apply for premature deposit withdrawals.
SMS/email alerts for transactions, based on customer preference, with transparent pricing for alerts.
This set of measures will significantly improve usability and provide customers with a truly global-standard digital dashboard.
3. Transactional Services
The most comprehensive upgrades are in this area, ensuring clients can do far more digitally and securely. Key features proposed include:
Dual-layer authentication (e.g., OTPs or hardware tokens).
Transfers within the same IBU, or to accounts in other IBUs/banks.
Facility to create Fixed Deposits online.
For corporates: robust user access management (e.g., Maker-Checker roles, access restrictions to specific accounts).
Ability to maintain pre-approved beneficiary lists and offer white-labelling options for fintech partners.
Initiating currency conversions directly through the platform.
Automated payouts (scheduled or rule-based).
Validation checks to reduce errors—like detecting incorrect account numbers, currency mismatches, or non-compliance with FATF jurisdictions.
Together, these features will create a safe, seamless, and highly functional internet banking environment for both individuals and corporates.
📅 Implementation Timeline
All IBUs will be required to comply with the revised norms by March 31, 2026.
🌍 Why This Matters
For Customers:More transparency (live FX rates, settlement cut-offs), improved digital tools (dashboards, alerts), and enhanced security.
For Corporates:Advanced features like user access controls, Maker-Checker workflows, and automated payouts will streamline treasury operations.
For Fintechs & Partners:Opportunities for collaboration via white-labelling and API-style features, ensuring fintech innovation thrives alongside traditional banking.
For GIFT City & India:By aligning IBUs’ internet banking services with international standards, GIFT City strengthens its appeal as a global financial hub.
📢 Call for Feedback
IFSCA has invited stakeholders—including banks, fintechs, corporates, and customers—to share their comments by October 13, 2025. Feedback can be sent via email in the prescribed format to the IFSCA Banking Department.
📝 Final Word
This consultation represents more than just a compliance update—it highlights IFSCA’s collaborative and progressive regulatory mindset. By actively engaging with stakeholders and incorporating global digital practices, IFSCA is ensuring that GIFT City’s IBUs deliver secure, transparent, and world-class internet banking experiences.
As digital banking becomes the backbone of global finance, these changes will put GIFT City on par with leading international banking hubs.
Disclaimer: This article is for informational purposes only and does not constitute legal, financial, or investment advice. Readers are advised to refer to the official IFSCA consultation paper and seek professional advice before making decisions.
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