Navigating the IFSCA TechFin & Ancillary Services Regulations Made Simple

India’s International Financial Services Centre (IFSC) is rapidly becoming a hub for global finance and fintech innovation. Recognising the convergence between financial services and technology providers, IFSCA has introduced a comprehensive regulation to streamline registration, compliance, and governance for TechFin and Ancillary Service Providers.

The IFSCA (TechFin and Ancillary Services) Regulations, 2025 is a pioneering framework that brings both service categories under a single unified regulatory umbrella. These new norms ensure ease of doing business, transparency, and regulatory consistency in GIFT City.

Why TechFin & Ancillary Services Regulation Matters

The regulation applies to all entities offering permitted TechFin services such as AI, blockchain, cybersecurity, IoT, and Ancillary services like advisory, audit, risk management, HR/payroll, legal services, and more. Entities must now obtain registration before commencing operations in GIFT City IFSC, ensuring higher oversight, quality control, and market integrity.

The move aligns with global standards of the Financial Action Task Force (FATF) and encourages clean jurisdictional participation.

Highlights of the 2025 Framework

Entities—whether companies, LLPs, or eligible foreign branches—must register via SWIT (Single Window IT Platform). The regulations mandate appointment of a Principal Officer, a Compliance Officer, full-time roles based in IFSC. This brings GIFT City in line with mature global jurisdictions.

Entities also must be from countries not flagged by FATF as high-risk jurisdictions. Financial reporting will be done in USD or other designated foreign currencies, with INR accounts permitted only for admin/legal expenses.

Permitted Services Under One Roof

Permitted TechFin Services: AI/ML, Big Data Analytics, Cybersecurity, Blockchain, RegTech, Cloud, DLT, Web 3.0, IoT, Metaverse, Tokenisation, Quantum Computing, and more.

Permitted Ancillary Services: Advisory, Auditing, BPO, KPO, Internal Controls, Governance Evaluation, Risk Advisory, HR/Payroll, Compliance Management, Due Diligence, Secretarial Services, Legal, Treasury, Research, Valuation, etc.

Governance & Compliance Standards

All registered providers must maintain fit-and-proper criteria, abide by an enforceable Code of Conduct, and operate with transparency. The IFSCA retains powers for inspection, registration suspension, and enforcement in case of non-compliance.

Provisions for waivers and relaxations are also available for market development or innovation use cases, subject to written approval.

What It Means for Stakeholders

• Startups & Founders can now innovate within a clear legal framework.

• Investors gain assurance in dealing with regulated, registered entities.

• Global players can structure back-end and technology arms within a clean, tax-efficient, and internationally aligned environment.

• Professionals (lawyers, CAs, CS, consultants) find new service avenues in registration, compliance, and operations.