Reserve Bank of India Issues Framework for Indian Banks’ Foreign Biz

The Reserve Bank of India (RBI) has put in place a framework to allow overseas subsidiaries and branches of Indian banks and financial institutions to undertake activities not specifically permitted in the Indian domestic market.

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The framework also specifies the applicability of these instructions to International Financial Services Centres in India, including Gujarat International Finance Tec-City (GIFT City). While these activities may not need prior approval, they are subject to compliance with all applicable laws/regulations and conditions stipulated by the RBI and those prescribed by the host regulator.

About The Compliance:

The parent Indian bank and financial Institution shall ensure that dealing in such products is done with the prior approval from their board and, if required, the appropriate authority in the jurisdictions concerned. They must have adequate knowledge, understanding, and risk management capability for handling such products, added the RBI.

Its Impact: