The International Financial Services Centres Authority (IFSCA) on March 14, 2024, issued a circular Ease of doing business: Settlement of Client’s Funds lying with Broker Dealer.
IFSCA has received representations from various market participants – both investors and market institutions - regarding doing away with the requirement of such monthly/quarterly settlement due to cost of remittance of funds.
With an objective to promote ease of doing business in IFSC and taking into account the representations from investors and discussions with the Stock Exchanges, the following has been decided:
• Unless otherwise specified by IFSCA, settlement of funds shall be done as per the Agreement/Consent Letter between the Broker Dealer and its client. The Stock Exchanges in IFSC may specify the format of such Agreement/ Consent Letter for the Broker Dealers.
• Such an Agreement/Consent Letter needs to be executed between the Broker Dealer and the Client at the time of onboarding itself.
• In case of existing clients, the Broker Dealers in IFSC may adopt a procedure to operationalize the same.
• The Stock Exchanges in IFSC shall put in place a mechanism for monitoring clients’ funds lying with the Broker Dealers.
[Circular No. IFSCA/CMD-DMIIT/SOF/2023-24/001]
