IFSCA - Participation in financial products linked to Indian Rupee (INR)

Last updated: 26 August 2021

Save Share

Quick Summary

The International Financial Services Centres Authority (IFSCA) has issued new guidance regarding financial products linked to the Indian Rupee (INR). Following a clarification from the Reserve Bank of India (RBI), branches of Indian banks and financial institutions operating within the IFSC are now permitted to offer these INR-linked products. This decision is subject to the directions issued by the IFSCA.

International Financial Services Centres Authority

CIRCULAR

F. No. 191/IFSCA/EC-NDF-INR/2020-21/1

Date: August 25, 2021

To, All Financial Institutions

Dear Sir/ Madam,

Subject: Participation in financial products linked to Indian Rupee (INR)

1. Financial Institutions (FIs) may refer to Section A.4(b) of Reserve Bank of India’s Master Direction – Direct Investment by Residents in Joint Venture (JV) / Wholly Owned Subsidiary (WOS) Abroad ¹dated January 1,2016 (as amended).

2. The Reserve Bank of India has clarified that the definition of the term “overseas entity” in the abovementioned section shall not include branches of Indian banks and branches of other Indian financial institutions operating in IFSC. Therefore, branches of Indian banks and branches of other Indian financial institutions operating in IFSC may, subject to the directions issued by the Authority, offer financial products linked to Indian Rupee.

Yours faithfully,

Supriyo Bhattacharjee
General Manager
supriyo.b@ifsca.gov.in

FAQ :

The notification concerns the participation of financial institutions in financial products linked to the Indian Rupee (INR) within the International Financial Services Centres (IFSC).

Branches of Indian banks and branches of other Indian financial institutions operating in the IFSC are permitted to offer these products.

The RBI clarified that the definition of 'overseas entity' in its Master Direction does not include branches of Indian banks and Indian financial institutions operating in the IFSC.

Yes, the offering of these financial products is subject to the directions issued by the IFSCA.

The circular is dated August 25, 2021.

Notification No : F. No. 191/IFSCA/EC-NDF-INR/2020-21/1
Source : https://ifsca.gov.in/Viewer/Index/223

219 Views Comment Share Miscellaneous Report

Notification posted by

CCI News Desk

Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

Comments