In a significant move reflecting the evolving landscape of the financial ecosystem in India’s International Financial Services Centres (IFSCs), the International Financial Services Centres Authority (IFSCA) has amended its framework governing ancillary services. This latest update specifically broadens the scope of “Trusteeship Services”, addressing market demand and aligning with recent regulatory developments.
Another key addition is the permission for trustees to service retail schemes launched by Fund Management Entities (FMEs), provided they are registered under the IFSCA (Fund Management) Regulations, 2025. These trusteeship services are subject to strict adherence to:
- Fit and proper criteria
- Code of conduct
- Other regulatory compliances
This move opens doors for trustees to operate within broader product offerings under FMEs, including mutual fund-like structures and hybrid investment vehicles, thereby enhancing the ecosystem’s retail participation.
Why This Matters
As IFSCs—particularly GIFT City—continue to position themselves as global financial hubs, the need for high-quality ancillary service providers has become more pronounced.
The expansion in permissible activities not only empowers trustees to offer a more comprehensive suite of services but also brings India’s regulatory framework more in line with global best practices.
Conclusion: A More Responsive and Robust IFSC Framework
With this amendment, the IFSCA has demonstrated its commitment to responsiveness, regulatory innovation, and market facilitation. By listening to market participants and adapting regulations to support growth and investor protection, IFSCA continues to strengthen the IFSC ecosystem as a competitive and trusted jurisdiction for cross-border financial services.
This change not only enhances operational efficiency but also fosters investor confidence and industry dynamism, paving the way for IFSCs to become a preferred destination for global financial activity.
