IFSCA Authority Meeting Decisions Reinforcing GIFT City as a Global Financial Hub

The International Financial Services Centres Authority continues to play a decisive role in shaping India’s international financial future. In its 26 Authority meeting held in December 2025, IFSCA approved a series of important regulatory reforms that directly impact fund management, capital markets, global in-house centres, professional services, and insurance operations within GIFT City.

These decisions are not incremental changes. They address real operational challenges faced by institutions working in an international financial centre. By improving regulatory flexibility, simplifying compliance, expanding access to talent, and encouraging global business models, the Authority has reinforced GIFT City’s position as a credible and competitive destination for cross-border financial services. The outcomes of this meeting provide clarity and direction for institutions planning long-term operations from GIFT City.

Fund Management Regulation Amendments Supporting Practical Operations

Broader Eligibility and Easier Access to Skilled Leadership

One of the most impactful decisions relates to the eligibility norms for Key Managerial Personnel in Fund Management Entities. Recognising the evolving nature of financial roles, the Authority approved a certification-based alternative eligibility route with reduced experience requirements. This change allows qualified professionals to move into leadership positions without unnecessary regulatory friction.

The scope of acceptable work experience has also been expanded. Experience from consulting advisory firms and private or public companies is now considered relevant when the nature of work aligns with financial industry responsibilities. This reform directly supports faster hiring, better succession planning, and a wider talent pool while maintaining governance standards.

Flexible Private Placement Memorandum Validity for Market Realities

To enhance operational efficiency, IFSCA approved targeted reforms across different entity categories.

For BATF entities, the mandatory requirement for physical office space has been removed, providing greater operational flexibility in structuring IFSC-based activities.

For capital market intermediaries, the Authority has expanded eligibility criteria by easing experience requirements, clarified the methodology for net worth calculation, and streamlined compliance obligations across intermediary categories. These changes reduce entry barriers while aligning IFSC regulations with global best practices.

Custodian Migration Window

Fund Management Entities required to appoint custodians registered in the IFSC have been granted a 24-month migration window. This transition period reduces disruption and allows entities to comply with updated requirements in a structured manner.

Global In-House Centre Regulations Expanding High-Value Financial Services

A Clear and Modern Regulatory Framework for GIC Units

The Authority approved the draft IFSCA Global In-House Centres Regulations 2025 to provide a comprehensive framework for establishing and operating GIC units in GIFT City. These units deliver financial and related services to global financial institution groups, including technology risk, compliance analytics, and operational support.

The framework aligns intending to develop GIFT City as a global hub for specialised financial services while strengthening India’s integration with international financial markets.

India’s Growing GIC Presence and Strategic Opportunity

India currently hosts nearly nineteen hundred global capability and in-house centres. Export services revenue from this sector reached 64 billion US dollars in the financial year 2024, and employment is projected to grow significantly by 2013. These figures highlight the strategic importance of regulated GIC operations at India’s international financial centre.

Key Features of the Revised GIC Regulations

The updated framework allows financial institution groups to set up GIC units directly or through third-party service providers. Multiple operating models are recognised, including captive centres, shared services, build-to-operate transfer joint ventures,s and hybrid structures.

GIC units may serve Indian group entities up to 10% of total annual revenue. Restrictions on employee transfers have been eased, and offshore entities serving India are encouraged to relocate operations to GIFT City. Clear rules on eligibility governance, reporting compliance, and transition ensure operational certainty while maintaining oversight.

Lower Entry Barriers for Professional Services Firms

Removal of Mandatory Office Space Requirement

The Authority approved the removal of the minimum office space requirement for Bookkeeping, Accounting, Taxation, and Financial Crime Compliance service providers. Earlier requirements increased fixed costs and discouraged new entrants. The amendment supports flexible work models, improves competitiveness, and strengthens the professional services ecosystem in GIFT City.

Capital Market Intermediary Reforms Improving Efficiency and Clarity

Eligibility for principal officers and compliance officers has been expanded to include post-graduate degrees in fintech science, technology, engineering, and mathematics. The experience requirement for graduates has been reduced from 10 years to 5 years, making senior roles more accessible.

Capital market intermediaries holding multiple registrations may appoint a single principal officer with a separate vertical head only for distribution activities. Clarifications on liquid net worth computation provide transparency by including deposit margins and base capital while excluding liabilities. The minimum net worth for custodians has been set at 1 million US dollars, with a transition period for existing entities.

The introduction of umbrella registration allows entities to apply for unified approval for multiple roles, reducing regulatory complexity.

Expanded Definition of Lloyd’s Service Company

The amendment to the definition of Lloyd’s Service Company now includes entities promoted by group companies of managing agents or members of Lloyd’s. This change allows wider participation and supports the development of a stronger insurance ecosystem within GIFT City.

Conclusion

The outcomes of the 26 IFSCA Authority meeting send a strong and consistent message to global and domestic stakeholders. GIFT City is being shaped through practical regulation that balances flexibility with oversight and growth with stability. By addressing operational challenges, expanding talent access, supporting global business models, and reducing unnecessary barriers, the Authority has reinforced trust in the IFSC framework.

For business leaders, CFOs, investors, and researchers, these reforms provide clarity and predictability for long term planning. They also strengthen GIFT City’s role in attracting cross-border financial services, consolidating offshore activities within India, and contributing to the national vision of Viksit Bharat. As regulatory frameworks mature and market participation deepens, GIFT City continues to emerge as a serious global financial centre backed by policy intent and institutional commitment.