One of the biggest complaints from foreign investors has been the need to submit the same documents repeatedly every time they seek a new financial service. Since each institution conducts its own KYC verification, customers are forced to go through the same process multiple times, leading to delays in service delivery. To address this issue and save customers' time, the International Financial Services Centres Authority (IFSCA) has prepared a draft framework. The draft circular clearly states that the initiative has been undertaken "to promote ease of doing business and to remove duplication of KYC process."

IFSCA has invited public comments on the proposed integration of all Regulated Entities with KYC Registration Agencies (KRAs). Under the proposal, all banks, brokers, fund houses, insurance companies and other regulated financial institutions operating in GIFT IFSC will be required to integrate with at least one IFSCA-registered KRA. Once a customer's KYC is completed, the information will be stored in the KRA system and can be accessed by other authorised institutions with the customer's consent. From September 1, 2026, uploading the KYC details of all new customers onto the KRA system will become mandatory.

Earlier, IFSCA had also provided Regulated Entities in GIFT IFSC access to NPCI's Aadhaar-based e-KYC Setu platform, enabling fully digital and faster customer onboarding. The core objective of the new initiative is "One KYC, Multiple Financial Services." In other words, once a customer's KYC is completed, the same information can be used by other authorised institutions, eliminating the need to repeat the KYC process for every new financial service.

How the New System Works

At present, if an investor opens a bank account in GIFT City and later invests in a fund, opens a brokerage account or avails any other financial service, a separate KYC process is required at each institution.

Under the proposed framework, a single KYC record will be maintained in the KRA system, and other Regulated Entities will be able to retrieve it with the customer's consent. This will significantly speed up the onboarding process and eliminate repetitive requests for the same documents.

If a customer's KYC already exists in the KRA system, the new institution will simply download the existing information and update it only where necessary. Every completed KYC will have to be uploaded to the KRA system within three working days.

IFSCA has also laid down a clear timeline for existing customers. The KYC records of all active clients onboarded before September 1, 2026, must be uploaded to the KRA system by October 30, 2026.

Customers to Get a KYC ID

Under the new framework, every customer will be assigned a Unique Identification Number (UIN) by the KRA. Using this UIN, customers will be able to access financial services from other institutions in GIFT IFSC without undergoing a fresh KYC process. While this model is already followed in India's domestic financial markets, it is now being extended to GIFT IFSC in line with international standards.

The Strategic Shift

This is not merely a reform of the KYC process. It is a major structural reform for GIFT City's financial ecosystem because it will:

·         Speed up onboarding for global investors.

·         Reduce compliance costs.

·         Eliminate duplication of KYC processes.

·         Minimise repeated verification of documents.

·         Improve Ease of Doing Business.

·         Strengthen Digital Financial Infrastructure.

·         Make cross-border financial services more efficient.

Based on the public comments received, IFSCA's three officials — Rishikesh Wandhekar (Assistant Manager), Pawan Kumar Chowdhary (Deputy General Manager), and Arjun Prasad (Chief General Manager) will place the feedback before the Authority, following which a final decision on the KYC framework is expected to be taken and its implementation made mandatory.