Fund Management and Financial Compliance

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Questions and Answers

What is the primary aim of the initiative regarding Fund Management?

To promote traditional trading methods.

To increase the tax revenue for the government.

To enhance liquidity across derivatives products on the stock exchanges. (correct)

To restrict the entry of foreign investors.

Which group is specifically targeted for enhanced ease of investing as a part of this initiative?

Local Indian traders.

Government entities.

Foreign institutional investors.

NRI and OCI investors. (correct)

What has been established to ensure compliance for onboarding RTPs?

A new marketing strategy.

A regulatory channel through IFSCA and SEBI. (correct)

A financial education program.

A taxation policy reform.

What guidelines are mentioned in the context of this initiative?

Anti Money Laundering and Know Your Customer Guidelines. Signup and view all the answers

What has been the trend regarding remittances to India?

They have remained consistent year after year. Signup and view all the answers

Which of the following countries was not mentioned as having regulators engaged in bilateral meetings with IFSCA?

Australia Signup and view all the answers

What type of approval was granted to NCOME TECH SOLUTIONS PRIVATE LIMITED?

Approval for a wholly owned subsidiary as a payment service provider Signup and view all the answers

What services are firms able to provide to non-resident clients from GIFT IFSC?

Book-keeping, accounting, taxation, and financial crime compliance services Signup and view all the answers

What requirement must banks meet when utilizing Buy-Sell agreements for bullion transactions at IIBX?

They need to have an IFSC Banking Unit registered as a Bullion Clearing Member Signup and view all the answers

Which of the following currencies was added to the specified foreign currencies in IFSCA regulations?

Danish Krone Signup and view all the answers

What is the purpose of the Circular issued under the International Financial Services Centres Authority regulations?

To specify the registration process for entities seeking to provide services Signup and view all the answers

What was the primary focus of the discussions during the bilateral meetings held by IFSCA?

Regulatory updates and collaboration Signup and view all the answers

Who chaired the Expert Committee on Transition Finance established by IFSCA?

Mr. Dhruba Purkayastha Signup and view all the answers

What has been permitted to widen the scope of participation at the India International Bullion Exchange?

Eligible units set up in the IFSC are now allowed to apply as Qualified Suppliers Signup and view all the answers

Which financial authority did IFSCA engage in meetings with regarding international markets?

Securities and Commodities Authority (UAE) Signup and view all the answers

What is the intent behind allowing firms to provide services from GIFT IFSC?

To improve the efficiency of services provided to non-residents Signup and view all the answers

What is the stated purpose of the wholly owned subsidiary approved for NCOME TECH SOLUTIONS PRIVATE LIMITED?

Carrying out payment services activities Signup and view all the answers

Which of the following is true regarding the eligibility of units to supply bullion on IIBX?

Only IFSC registered entities can apply to be Qualified Suppliers Signup and view all the answers

Which of the following services is specifically mentioned in the regulations for IFSC entities?

Book-keeping services Signup and view all the answers

How did IFSCA plan to handle climate finance initiatives according to the report?

Through the establishment of an Expert Committee Signup and view all the answers

Which regulatory body is responsible for the oversight of the services offered from GIFT IFSC?

International Financial Services Centres Authority Signup and view all the answers

What is the primary purpose of the proposed IFSCA (Listing) Regulations, 2024?

To revise the regulatory framework for issuing and listing financial products Signup and view all the answers

Which organization is designated as the regulatory authority for Payment Systems in the IFSC?

International Financial Services Centres Authority (IFSCA) Signup and view all the answers

What will the IFSCA do to aid in the regulation and supervision of Payment Systems?

Constitute a committee known as the Board for Regulation and Supervision Signup and view all the answers

Which section of the PSS Act allows the IFSCA to perform its designated functions?

Section 34B Signup and view all the answers

From which jurisdictions have best practices been studied for the proposed regulations?

Hong Kong, UK, Singapore, USA Signup and view all the answers

What kind of financial products does the proposed IFSCA (Listing) Regulations, 2024 address?

Securities, debt securities, and other financial products Signup and view all the answers

What is the role of public consultation in the formation of the proposed regulations?

To gather feedback for better policy formulation Signup and view all the answers

What aspect of the proposed regulations does the consultation paper specifically focus on?

The issue and listing of various financial products Signup and view all the answers

What was the total amount of FCY-FCY Derivatives for June 2024?

102386.84 USD Mn Signup and view all the answers

Which sector had the highest amount outstanding in April 2024?

Banking and Finance Signup and view all the answers

In which month did the amount outstanding for Cement and Cement Products surpass 870 USD Mn?

June 2024 Signup and view all the answers

What was the total exposure percentage for India in May 2024?

71.85% Signup and view all the answers

Which industry had an amount outstanding of 51.67 USD Mn in April 2024?

Paper and Packaging Signup and view all the answers

What was the total amount for Others in FCY-FCY Derivatives for April 2024?

648.33 USD Mn Signup and view all the answers

Which month experienced a decrease in outstanding amount for Medical and Medical Equipment compared to the previous month?

June 2024 Signup and view all the answers

Which of the following sectors saw an increase in outstanding amount from April to June 2024?

Iron & Steel Signup and view all the answers

What was the total amount for Agriculture and Forestry in June 2024?

425.05 USD Mn Signup and view all the answers

Which country had the lowest total exposure percentage in June 2024?

Bangladesh Signup and view all the answers

What was the number of applications received under IFSCA Payment Services Regulations in total?

2 Signup and view all the answers

Which sector consistently had amounts outstanding below 10 USD Mn across the reported months?

Paints Signup and view all the answers

Which month had the highest total value for IFSC Stock Exchanges turnover?

Data not available Signup and view all the answers

Study Notes

Fund Management

IFSCA and SEBI have created a regulatory channel for NRI/OCI investors to invest in India through IFSC funds.
This initiative will facilitate the onboarding of top HFT/Algorithmic Trading firms to enhance liquidity across derivatives products in IFSC.

Book Keeping, Accounting, Taxation, & Financial Crime Compliance Services

The Stock Exchanges have been provided operational flexibility to specify eligibility criteria for RTPs.
These firms will be able to offer their services to non-resident clients efficiently and seamlessly from GIFT IFSC, which will create employment opportunities for the Indian workforce.

Bullion Clearing

ANZ Bank has been licensed to setup an IBU at GIFT IFSC.
Banks are required to utilize an IFSC Banking Unit (IBU) registered as a Bullion Clearing Member for clearing their purchase transactions.
IFSC entities and suppliers are permitted to supply bullion at IIBX.
These entities can apply to become a Qualified Supplier on IIBX (QS-IFSC).

International Relations

IFSCA has held bilateral meetings with several securities markets regulators, including the Commodity Futures Trading Commission (USA) and Financial Services Agency (Japan).
The focus of the meetings was on regulatory updates and collaboration on areas of mutual interest.

Sustainable Finance

IFSCA has formed an Expert Committee on Transition Finance with Dhruba Purkayastha as Chair.
The committee's third meeting focused on defining the scope and the policy and instruments related to transition finance.

Payment & Settlement

IFSCA (Board for Regulation and Supervision of Payment and Settlement Systems) Regulations, 2024 are under public consultation.
IFSCA will be the designated authority for regulating and supervising Payment Systems in the IFSC.
A committee known as the Board for Regulation and Supervision of Payment and Settlement Systems (BPSS) will be established.

Capital Markets

IFSCA issued a consultation paper on the proposed IFSCA (Listing) Regulations, 2024 to revise the regulatory framework for the listing of financial products.
IFSCA has proposed amendments to the regulations based on best practices in other jurisdictions such as Hong Kong.
The consultation paper provides a revised regulatory framework for issuing and listing various financial products, including specified securities, debt securities, and other financial products on the recognised stock exchanges in the IFSC.

Derivative Outstanding of IBUs

The notional value of FCY-INR derivatives (to be settled in FCY) has decreased from 27372.48 in April to 24773.55 in June.
FCY Interest Rate Derivatives (to be settled in FCY) have seen a gradual increase from 98537.63 in April to 102386.84 in June.

Industry Wise Credit Exposure of IBUs

Petrochemicals, Metals, and Banking and Finance are the top sectors in terms of credit exposure for IBUs.
Petrochemicals remains consistent with an amount outstanding of around USD 3860 million over the three months.

Country Wise Exposure of IBUs

India consistently has the highest exposure, accounting for 72.91%, 71.85%, and 73.17% of the total exposure in April, May, and June respectively.

Payment Services

IFSCA has received a total of 2 applications under the IFSCA (Payment Services) Regulations, 2024.

IFSC Stock Exchanges Turnover

The total traded value on IFSC Stock Exchanges has consistently increased over the past three months.
The total traded value increased from USD 165004.26 Million in April to USD 184506.89 Million in June.

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Description

This quiz covers the regulatory initiatives introduced by IFSCA and SEBI for NRI/OCI investors in India, especially in relation to IFSC funds and the operational flexibility provided to Stock Exchanges. It also discusses the role of banks like ANZ in bullion clearing and the employment opportunities arising from these regulations.