IFSCA Permits Portfolio Managers to Park Funds of Clients in Separate Accounts

Notification No. IFSCA/2022-23/GN/REG034., dated 11.04.2023

IFSCA has notified an amendment to IFSCA (Fund Management) Regulations, 2022. An amendment has been made to Regulation 77. As per the amended norms, the funds of a client who avails of portfolio management services (other than those availing only advisory services) can be maintained in:

(a) a specific bank account of Fund Management Entity (FME) in a banking unit,

(b) a specific bank account of the client in a banking unit, a bank in India or a Foreign Jurisdiction; or

(c) any other manner as may be specified by the Authority

Further, when the funds are maintained in the specific bank account of a client, the FME operating as portfolio manager must ensure that it is duly authorised to operate the said bank account either by itself or through a custodian. It shall also provide the details of all such bank accounts including transactions carried out to the Authority.

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