Brief Overview:
International Financial Services Centres Authority (Registration of Factors and Registration of Assignment of Receivables) Regulations, 2024 (“Regulations”) has been rolled out.
Technical Details:
Key Highlights:
1) To do factoring business in International Financial Services Centre the Factor needs to do registration with International Financial Services Centres Authority. The following are key criteria’s for the registration:
(a) The Factor shall already be a finance company
(b) Experience in business of factoring
(c) Necessary infrastructure
(d) Financial soundness
(e) Key managerial person of Factor shall have experience in business of factoring
(f) Satisfying the ‘fit and proper’ requirement
2) Trade receivables financed through TReDS are required to be filed with the central registry.
Key Takeaways:
The Regulations repeal the Registration of Assignment of Receivables (Reserve Bank) Regulations, 2022 and Registration of Factors (Reserve Bank) Regulations, 2022 issued by RBI and it specifically also refers back to applicability of Factoring Regulation Act
For further details, please see:
International Financial Services Centres Authority
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