IFSC Authority simplifies opening and maintenance of foreign currency bank account in IFSC by notification of International Financial Services Centres Authority (Banking) Regulations, 2020
The International Financial Services Centres Authority has recently notified the International Financial Services Centres Authority (Banking) Regulations, 2020 (‘IFSCA Banking Regulations’)1 for regulating banking and investment activities in GIFT International Financial Services Centre (IFSC). IFSCA Banking Regulations aim to relax the existing framework2 for IFSC Banking Units as well as extend the possibility to open and maintain a foreign currency bank account even to Indian residents. This alert summarizes some of the important updates in this regard.
Categories of persons permitted to open bank account in IFSC
As per the said Regulations, the following categories of persons are now permitted to open, hold and maintain accounts in a freely convertible foreign currency with a banking unit in IFSC:
Indian resident individuals having net-worth of at least USD 1 million or equivalent in the preceding financial year
Non-resident individuals having a net-worth of at least USD 1 million or equivalent in the preceding financial year
Resident corporate and institutional entities
Non-resident corporate and institutional entities
Individuals are permitted to open, hold and maintain current or savings or term deposit accounts while others are permitted to open, hold and maintain current or term deposit accounts.
However, it may be noted that the opening of such accounts by resident individuals and corporates shall be further subject to the FEMA (Foreign Currency Accounts by a Person Resident in India) Regulations, 2015.
