IFSCA - Regulations, Listing and Compliances · Fund Management Services

Authorisation and Registration of Fund Management Entities in IFSC

Updated 11 October 2026 · Fact-checked

A fund management entity (FME) is a person that manages funds in the IFSC. Under the IFSCA (Fund Management) Regulations, 2022, it must be authorised or registered in one of three categories: authorised, registered non-retail or registered retail. Your answer must cover category, eligibility, application, fees and net worth, and apply them to the facts.

Understand Authorisation and Registration of Fund Management Entities

A fund management entity (FME) is the entity that raises and manages money for investors through funds or schemes set up in an International Financial Services Centre (IFSC), such as GIFT City. It cannot start business freely. The IFSCA (Fund Management) Regulations, 2022 require it to first obtain an authorisation or registration from IFSCA.

The regulations divide FMEs into three categories: Authorised FME, Registered FME (Non-Retail) and Registered FME (Retail). The logic is simple. The wider the public you can reach, and the larger the money you can handle, the higher the entry bar. A small-scale manager dealing with a limited set of sophisticated investors sits at the lighter end. A manager who can offer retail schemes to the general public sits at the strictest end.

The entry bar is tested through a few heads: the legal form of the applicant, its presence in the IFSC, a fit and proper person status, key managerial personnel (including a Principal Officer and a Compliance Officer), infrastructure and a minimum net worth that depends on the category. Fees are also payable, both at application and on an annual basis, as set out in the regulations.

In the exam, treat this as a classification-plus-compliance topic. First place the entity in the right category. Then check each condition against the facts. Finally state what the entity may do and what it must still comply with. Check exact net worth amounts, fee amounts and corpus limits in the latest text of the regulations, because IFSCA amends them from time to time.

Key rules to remember

Three FME categories: Authorised FME | Registered FME (Non-Retail) | Registered FME (Retail); Know the three labels exactly. Retail is the category linked to schemes offered to the general public and carries the highest bar.
Core entry test: Category + eligibility + fit and proper + KMPs + net worth + fees = grant; Use this as a checklist when answering any case on whether an applicant qualifies.
Net worth rule: Net worth required rises with the category and scope of activity; Quote the exact amount only if you are sure of it from the current regulations. Otherwise state the principle and the schedule.
Activity limit rule: No FME may manage a scheme outside the permission of its category; A lower category cannot take up activity reserved for a higher one without moving up.

How to solve Authorisation and Registration of Fund Management Entities questions

Use this order for any question on authorisation or registration of FMEs. It keeps your answer in the provision, analysis, conclusion format.

1Read the facts and note the applicant: its legal form, location (inside or outside the IFSC), size, and the kind of investors it wants to serve.
2Identify the category it needs: authorised, registered non-retail or registered retail, based on the schemes and investors it plans to deal with.
3State the rule: the IFSCA (Fund Management) Regulations, 2022 require authorisation or registration before commencing fund management activity in the IFSC.
4Test each condition against the facts: eligibility of the applicant, fit and proper status, Principal Officer and Compliance Officer, infrastructure and net worth.
5Cover the process: online application to IFSCA with the required documents and fees, IFSCA's scrutiny, and grant or refusal.
6Conclude clearly: grant or not, in which category, and what gap the applicant must fix. Add the follow-up duty such as paying annual fees and meeting ongoing compliance.

Quickest way: Category-first checklist

When to use it: Use when a short case gives you an applicant and asks whether it can be authorised or registered, or which category applies.

Write the three categories in one line.
Pick the category from the type of scheme and investor in the facts.
Tick off five items: form and location, fit and proper, key personnel, net worth, fees.
Write the conclusion in one sentence and name the missing item, if any.

Common mistakes in Authorisation and Registration of Fund Management Entities

Mixing up the three categories or using the old two-way split of authorised and registered only.
Students remember 'authorised' and 'registered' but forget that registered has a retail and a non-retail version.
Fix: Always write all three labels together and link retail to schemes for the general public.
Quoting exact net worth or fee figures from memory.
Students rely on a number seen in a note, which may be outdated after an amendment.
Fix: Quote a figure only if you are sure it is current. Otherwise state that net worth rises with category and is as specified in the regulations.
Treating net worth as the only test.
Net worth is easy to remember, so answers stop there.
Fix: Also cover fit and proper status, key managerial personnel, infrastructure and the application process.
Forgetting that approval is needed before starting activity.
Students focus on how to apply and miss the prohibition on starting without a certificate.
Fix: Begin the conclusion with: the entity cannot commence fund management in the IFSC until IFSCA grants authorisation or registration.
Confusing the FME with the fund or scheme it manages.
Both are covered in the same chapter and have similar names.
Fix: Remember: the FME is the manager and is authorised or registered. The scheme is the product and has its own conditions.

Worked examples

Example 1

A Mumbai-based asset manager wants to manage a retail scheme for the general public from GIFT City. A partner says an authorised FME licence is enough as the manager is experienced. Advise.

Show the solution

Provision: the IFSCA (Fund Management) Regulations, 2022 place FMEs in three categories: authorised, registered non-retail and registered retail.
Analysis: the manager wants to offer a scheme to the general public, which is retail activity. The retail category is the one that permits this and it carries the highest bar.
Experience alone does not decide the category. The category is decided by the type of scheme and investors, and the applicant must still meet eligibility, fit and proper, key personnel and net worth conditions for that category.
The applicant must also be present in the IFSC and apply to IFSCA with the required documents and fees.

Answer: The partner is wrong. The manager needs registration as a Registered FME (Retail), and must satisfy the eligibility, fit and proper, key personnel and net worth conditions of that category before starting activity.

Example 2

Navya Capital Advisors LLP has applied to IFSCA for registration as a non-retail FME. It has a Principal Officer but no Compliance Officer, and its net worth is below the amount needed for the category. Can IFSCA grant registration?

Show the solution

Provision: an applicant must meet the requirements for its category, including key managerial personnel and the minimum net worth stated in the regulations.
Analysis on personnel: the regulations expect a Principal Officer and a Compliance Officer. Only the first is in place, so a gap exists.
Analysis on net worth: net worth below the minimum for the category is a failure of a core condition.
Conclusion: IFSCA cannot properly grant registration on the present facts, because two conditions are unmet.

Answer: IFSCA should not grant registration now. Navya must appoint a Compliance Officer and raise its net worth to the required level for the category, then reapply or complete the application, and pay the applicable fees.

Exam tips

Open every answer with the category, because marks follow the correct classification.
Do not invent figures. If unsure of an amount, state the principle and refer to the schedule of the regulations.
Use a short list for eligibility conditions. Examiners reward complete and orderly coverage.
Close with a clear conclusion on grant or refusal, then name the follow-up compliance.
Read the facts for traps such as a missing officer, low net worth, or an entity outside the IFSC.

Practice questions from Fund Management Services

Authorisation and Registration of Fund Management Entities: frequently asked questions

What are the types of fund management entity under IFSCA?

There are three: Authorised FME, Registered FME (Non-Retail) and Registered FME (Retail). The category depends on the schemes and investors the entity wants to serve. Retail is the highest tier.

How do I get registration as a fund management entity in the IFSC?

You apply to IFSCA under the IFSCA (Fund Management) Regulations, 2022 with the prescribed details, documents and fees. IFSCA examines the application and grants authorisation or registration if you meet the conditions. You cannot begin activity before that.

Do I need to remember the exact net worth figures for the exam?

Learn the principle that net worth rises with the category, and note the figures only from the current text of the regulations. Because amendments are possible, an answer that explains the rule and the test is safer than one built on a remembered number.

What are the main eligibility points for an FME?

Look at the applicant's form and presence in the IFSC, fit and proper status, key managerial personnel such as a Principal Officer and a Compliance Officer, infrastructure and minimum net worth. Cover all of them in a case answer.