India’s International Financial Services Centre (IFSC) at GIFT City, Gandhinagar, has been established to provide global-standard financial infrastructure with benefits like tax exemptions, ease of capital flow, and sustainable facilities. The International Financial Services Centre Authority (IFSCA) regulates banking, insurance, capital markets, fintech, and more, aligning India’s framework with global best practices. Anti-Money Laundering (AML) and Countering Financing of Terrorism (CFT) measures are critical here to ensure global credibility, investor trust, and compliance with FATF standards, while also protecting the ecosystem from illicit fund flows.
The regulatory framework includes the Prevention of Money Laundering Act (PMLA), 2002, IFSCA AML/CFT/KYC Guidelines (2022), UAPA, FATF, FATCA, UNSC sanctions, and FIU-IND reporting requirements. Regulated entities must adopt a risk-based approach, conduct customer due diligence, maintain transaction records, and report suspicious activities. While the framework ensures transparency and investor confidence, challenges remain in verifying beneficial ownership, combating technological risks like deepfakes, and keeping up with evolving financial crime techniques.
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