The International Financial Services Centres Authority (IFSCA) has laid down financial soundness requirements for payment system operators (PSOs) in GIFT IFSC, setting minimum net-worth thresholds for some categories and giving existing operators six months to comply.
The circular, issued on October 27, 2026, came into force with immediate effect and covers both operators already running payment systems in International Financial Services Centres and entities seeking fresh authorisation.
What the norms require
- Trade Receivables Discounting System (TReDS) operators: minimum net worth of $1 million (about ₹9.5 crore).
- Legal Entity Identifier (LEI) issuers: minimum net worth of $200,000 (about ₹1.9 crore).
- Trade repositories: net worth equal to at least one year of operating costs, computed every six months.
- Large-value payment systems and card payment networks: required to maintain a sound financial position, without a fixed rupee or dollar floor.
For the purpose of the norms, net worth broadly comprises paid-up equity capital, eligible reserves and certain compulsorily convertible preference shares. Accumulated losses, intangible assets and deferred revenue expenditure are to be deducted, and revaluation reserves cannot be counted.
Compliance and reporting
Existing PSOs must meet the requirements within six months of the circular and, going forward, submit a statutory auditor’s certificate confirming compliance for the previous financial year by September 30 each year. Trade repositories must also file half-yearly computations of their financial position. New applicants will have to attach an auditor’s certificate showing they meet the applicable criteria along with their authorisation application.
Why IFSCA moved now
According to an IFSCA official quoted by The Hindu BusinessLine, the Payment and Settlement Systems Act, 2007 requires the regulator to weigh an applicant’s financial status, management experience and integrity before granting authorisation, but “financial status” is not defined in the Act or related banking laws. The new criteria are meant to bring clarity for both incumbents and new entrants. Non-compliance could invite action under Chapter VII of the Act, which deals with offences and penalties, though the regulator does not expect existing operators to fall short.
What it means for fintechs
The categories covered are largely dominated by established players, such as the Clearing Corporation of India in large-value payments and global card networks. Fintechs and smaller providers offering cross-border payment services in GIFT IFSC continue to fall under the separate IFSCA (Payment Services) Regulations, 2024, which set an initial net-worth requirement of $100,000.
The move adds another layer of prudential clarity to GIFT City’s payments stack at a time when the IFSC is drawing more cross-border payment and trade-finance players, giving operators a defined capital benchmark to plan around.
