The International Financial Services Centres Authority (IFSCA) on July 09, 2026, issued the consolidated IFSCA (Finance Company) Regulations, 2026. The consolidated regulations are amended upto May 07, 2026.
The consolidated amendments clarify that registration with the Authority is mandatory for setting up Finance Companies or Finance Units in IFSCs, unless the entity is already registered for the same permissible activity under another framework. Entities can establish Finance Companies in various forms (subsidiary, joint venture, or new company), while Finance Units must be entities regulated in their home jurisdiction and may require a No Objection Certificate (NOC) from their home regulator.
The amendments strengthen prudential and operational requirements, including minimum capital/owned fund norms, capital adequacy (8% CR), liquidity, and exposure limits. They also expand and clearly define permissible core and non-core activities, including lending, leasing, investment, treasury operations, and advisory services, while restricting speculative transactions and ensuring compliance with FEMA, KYC, AML, and corporate governance norms.
Overall, the changes aim to streamline registration, broaden business activities, ensure regulatory compliance, and enhance financial stability of Finance Companies and Units operating in IFSCs.
