International Financial Services Centres Authority (Banking) Regulations, 2020

The International Financial Services Centres Authority (IFSCA) approved the International Financial Services Centres Authority (Banking) Regulations, 2020.

Daily Current Affairs Quiz 2020

Key-Points

 Banking constitutes one of the major focus areas of IFSC and is expected to drive and facilitate the other constituent operations in the IFSC in due course.

A self-contained regulation laying down the major principles of banking operations at IFSCs is thus an important step in the IFSC reaching its desired potential.

The salient aspects of the Banking Regulations include:

Laying down the requirements for setting up IFSC Banking Units (IBUs)

Permitting persons resident outside India (having net worth not less than USD 1 Million) to open foreign currency accounts in any freely convertible currency at IFSC Banking Units (IBUs)

Permitting persons resident in India (having net worth not less than USD 1 Million) to open foreign currency accounts in any freely convertible currency at IBUs to undertake any transaction under the Liberalised Remittance Scheme (LRS) of the Reserve Bank of India.

Laying down the permissible activities of IBUs including credit enhancement, credit insurance, and sale , purchase of portfolios, engage in factoring and forfaiting of export receivables and undertake equipment leasing, including aircraft leasing

Permitting the Authority to determine business that a Banking Unit may be permitted to conduct in INR with persons resident in India and persons resident outside India, subject to settlement of the financial transaction in relation to such business in freely convertible foreign currency.