The two main objectives of Treasury Centers are centralized management of funds and the use of global funds in the group. | Photocredit: Vijay Soneji
The International Financial Services Centers Authority (IFSCA) has facilitated the framework for setting up worldwide and regional business financing centers to strengthen the profession of Gift City as a global investment destination.
Activities such as capital increase, borrowing, derivatives and currency transactions are permitted.
“The updated framework brings the much needed clarity to allowing permissible business activities. Moreover, the introduction of specific permissibility for holding companies marks a significant step forward, which provides greater flexibility for business structures and the profession of Gift City as a worldwide investment platform is further strengthened,” said Jaiman, said Eyan, “said Eyan, Een.
Capital can be supplied by issuing shares. Borrowing includes deposits between companies and credit schemes. Transactions or investing in financial instruments issued in IFSC or external IFSC, performing derivat transactions and DeviezRansactie; Factoring and fixing, as well as liquidity management are now permitted.
The framework aims to bring financial services and transactions that are currently being carried out in offshore financial centers through Indian business entities and by overseas branches or subsidiaries of financial institutions to donate IFSC.
A Treasury Center acts as an internal bank in every multinational company. The two main objectives of Treasury Centers are centralized management of funds and the use of global funds in the group.
Conditions apply
Entities that these Treasury Centers want to set up must set up the necessary infrastructure in IFSC, including sufficient office space, equipment and communication facilities to perform the permitted activities. The entity must have at least five qualified staff, based in IFSC, including a head of the Treasury and Compliance Officer before the start of the activities.
The entity must have a policy for corporate governance and risk management. Any change in the check over 20 percent of the total share capital as a result of corporate re -structuring must request prior approval of the IFSCA. It must prove that the assets are to meet the ownership stock requirements and the parent may not come from a jurisdiction with a high risk as identified by the Task Force Financial Action.
Published April 13, 2025
