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CS Professional · IFSCA - Regulations, Listing and Compliances · Fund Management Services

Kabir Wealth, an FME, intends to offer a scheme in GIFT IFSC to retail investors in India and abroad, whereas Rhea Partners intends to raise funds only from accredited and similar sophisticated investors. Which statement correctly reflects the framework?

Kabir, serving retail investors, must meet the stricter retail category requirements, while Rhea, raising money from accredited or similar sophisticated investors, can operate under the lighter non-retail category. IFSCA's framework scales regulation to the investor protection needed, and retail schemes are permitted.

  1. ABoth may operate under identical, lighter requirements since all IFSC funds are for institutions
  2. BRetail schemes are barred entirely in IFSC
  3. CKabir must fall in the retail category with stricter requirements, while Rhea may operate as a non-retail category with lighter requirementsCorrect
  4. DRhea needs stricter requirements than Kabir because accredited investors need more protection

Explanation

The framework is graded by investor type: retail schemes bring higher net worth, governance and disclosure obligations on the FME, while non-retail (accredited or large-value) offerings face lighter regulation. Retail is permitted, so barring it is wrong, and requirements do not rise for sophisticated investors.

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