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CS Professional · IFSCA - Regulations, Listing and Compliances · Overview of FinTech and Service Providers in IFSC

Kaveri Wealthtech wants to set up a unit in GIFT IFSC to provide FinTech services to financial institutions there. Which statement best describes the regulatory position of its activity?

IFSCA is the single unified regulator for financial products, services and institutions in IFSCs, so Kaveri Wealthtech should approach IFSCA for authorisation. It need not seek separate approvals from RBI, SEBI and IRDAI for its IFSC activity, and it is not unregulated.

  1. AIFSCA is the unified regulator for financial products, services and institutions in the IFSC, so the unit deals with IFSCA for FinTech authorisationCorrect
  2. BThe unit must obtain approval separately from RBI, SEBI and IRDAI for each activity inside the IFSC
  3. COnly the State Government of Gujarat regulates FinTech units in GIFT City
  4. DFinTech units in the IFSC are unregulated until they reach a prescribed turnover

Explanation

The IFSCA Act, 2019 created a unified authority for financial products, services and institutions in IFSCs, replacing the multi-regulator position for IFSC activities. Hence the unit primarily approaches IFSCA. Separate approvals from each domestic regulator for IFSC activity is the pre-unification position and is wrong.

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