IFSCA’s Voice
The world is changing in terms of investment, and the main focus of this is the International Financial Services Centre (IFSC), which is located in Gandhinagar. The IFSCA Gift City presented an unprecedented series of changes through the Fund Management (Amendment) Regulations, 2026, on January 28, 2026.
These changes are not regulatory fine-tunings but a blueprint of any business owner who needs to start with less friction and more efficiency of a Fund Management Entity (FME).
As a Gift City Specialist, we have evaluated these developments to make you realize how they have made the process of establishing a new financial venture easier. You can be a first-time fund manager or a professional who may already have considerable experience in the field, but has to transfer to a tax-neutral zone.
These amendments are made to help you succeed.
1. Reduction in the Entry Barrier: New KMP Qualification Rules
The hardest challenge to the establishment of a new fund has always been the experience requirement, which is strict when it comes to become a Key Managerial Personnel (KMP). The old rule of five years of level experience tended to marginalize young, brilliant founders.
The 2026 Strategic Shift:
- The Professional Fast-Track: In case a KMP has a professional qualification (CA, CS, or CFA), the experience required has been cut down to only 3 years.
- The Certification Pathway: In cases of individuals possessing certifications that have been approved by the Authority, post-qualification experience is now reduced to a bare 2 years in a qualified institution.
- Expanding the Talent Pool: The eligibility of the institution has been redefined to include, not only banks and fund houses, but also experience in the finance, accounts, secretarial, or law department of any private or government company.
This rest is what assures that the IFSCA Gift City is open to a greater pool of talent, which makes it easier to identify and place qualified leadership in the new business.
The first step for any budding fund manager that wants to take advantage of these lenient qualification rules is to get an IFSCA registration.
The process of working through the regulatory nuances of the application, writing the narrative about your business plan, and having your KMPs comply with the necessity of the 2026 specifics, in particular, will require a specific, detail-focused procedure. Professional advice is necessary to make sure that your registration with the International Financial Services Centre (IFSC) is smooth and in its rightful place.
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Learn more about International Financial Service Centre (IFSC) Consulting and how GIFT City structures can unlock global investment efficiency.
IFSCA-C →2. Strategic Flexibility: Capital and Time Safety
To begin a fund, it is necessary to have a successful fundraising period. Previously, missing the deadline of the minimum corpus, you could run the risk of the expiry of your documents, and have to repeat the costly process of applying.
The 2026 Flexibility Rules:
- Six-Month Extensions: In case an FME does not meet the minimum corpus size in the period, it can now choose to extend the validity of its placement memorandum. The extensions have a period of six months each.
- Fractional Fees: Fractional Fees. To reduce expenses at the start-up level, the initial extension fee is a mere 25 percent of a fresh filing fee. The further extensions are billed at 50 percent.
Since we work as an IFSCA Consultant, we view this as an enormous safety net to new founders, as they have more time to find deals with investors without the concern of an expiry of regulations.
3. Open-Ended Schemes Operational Benefits
To fund managers initiating open-ended money, the 2026 amendments offer obvious operational insurance that would preserve the fund’s integrity at its inception phase.
- Unlisted Securities Threshold: Open-ended schemes are now restricted to investing in unlisted securities until reaching a minimum corpus of USD 3 Million. This will help to keep new funds in adequate liquidity for their investors before investing in more illiquid assets.
- 24-Month Custodian Grace Period: Given the time implicated in establishing local infrastructure, the ifsca gift city now provides a 24-month period to appoint a local custodian in the IFSC.
In the transition period, which is a two-year period, FMEs may still make use of independent custodians in India or other regulated foreign jurisdictions.
4. The need to have an International Financial Services Centre Consultant for every founder
These new regulations are complex, and therefore, it is not about filling out the paper anymore to get started, but it is about positioning. Our role as an International Financial Services Centre Consultant allows you to adjust these new rules of 2026 to other enormous benefits, including:
- The 20-Year Tax Alpha: Going forward with the FME rules, with the Budget 2026 extension of the 100% tax holiday to 20 years.
- US-India Trade Synergy: The establishment of funds that will be able to cash in on the 18% US Tariff reset on Indian exports.
- Global FDI Inflow: Positioning your fund to become FDI-Ready to take advantage of the many billions of dollars that are predicted to flow into the IFSCA Gift City out of the US and EU trade locations.
The ways Gift City Advisor can make you grow
Gift City Advisor is a company that specialises in simplifying the complex. We are your loyal Gift City Consultant, so we do not simply give you advice; we give you a roadmap.
Our staff of professionals serves as your IFSC Consultant to make sure that not only is your FME compliant, but that it is optimized in its strategy to take advantage of all the benefits of the 2026 amendments.
Since the KMP qualification maps to working in the new extension fees, Gift City Advisor is your companion in the International Financial Services Centre (IFSC).
Do you plan to start your Fund Management business in 2026 era?
👉 Loads of Help with FME Starts with Contact Gift City Advisor!