IFSCA has issued Consultation paper on Regulatory Framework for differential distribution in Restricted Schemes and Venture Capital Schemes to facilitate blended finance and other fund structures. The objective of this consultation paper is to seek comments from the public on the proposal to facilitate blended finance and other fund structures in the IFSC(s) by permitting differential distribution in the Venture Capital Schemes and Restricted Schemes under Part A and B, respectively, of Chapter III of IFSCA (Fund Management) Regulations, 2025.
In order to operationalise the blended finance structures in practice, a certain degree of flexibility in fund distribution mechanism is essential. Without such flexibility it would be challenging to design appropriate risk-sharing arrangements that facilitate private capital participation. Enabling such mechanisms ensures that concessional and private capital can work in tandem, thereby achieving both developmental impact and sustainable fund-raising.