International Financial Services Centres Authority (IFSCA) notifies Fintech Incentive Scheme

  • News|Blog|FEMA & Banking|
  • 3 Min Read
  • By Taxmann
  • |
  • Last Updated on 8 February, 2022

Fintech Incentive Scheme

The IFSCA has notified IFSCA (FinTech Incentive) Scheme, 2022. Vide. Notification No: IFSCA/2021-22/GN/022 dated 02.02.2022. The Objective of the scheme is to promote the establishment of a world-class FinTech Hub across jurisdictions, at International Financial Services Centre (IFSCs) by providing financial support to FinTech activities in the form of a specific grant(s) as specified in the scheme, based on their eligibility and fulfilment of terms and conditions as may be specified.

The scheme specifies provisions relating to eligibility criteria, the meaning of ‘fintech’, eligible beneficiaries and the manner of execution of the scheme. This write-up aims to summarise the provisions relating to Fintech Incentive Scheme in a lucid manner. The key highlights of the scheme are discussed hereunder:

1. When scheme will be effective?

This scheme shall be effective from the 02nd day of February 2022 and shall be operational for an initial period of three years from the date of commencement.

2. Who will be considered as “Fintech”?

As per Regulation 3 (vii) of the IFSCA (FinTech Incentive) Scheme, 2022. “FinTech” means a technologically enabled innovative solution aiding or assisting Financial Institutions in the delivery of Financial Products or Financial Services.

3. Who will be the eligible beneficiaries?

This scheme shall be open to the following Fintechs:

(a) Domestic FinTechs seeking access to overseas markets;

(b) Domestic FinTechs seeking a listing on IFSCA recognised stock exchanges;

(c) Foreign FinTechs seeking market access to IFSCs in India and work within the Authority’s regulatory framework;

(d) Foreign FinTechs seeking access to the domestic market under Inter-Operable Regulatory Sandbox (IORS) framework;

(e) Domestic FinTechs extending the business to the IFSCs either by way of authorisation or registration or through the regulatory sandbox.

4. What will be the Eligibility Criteria?

The eligibility of the scheme is divided into 2 parts namely:

1. Where the Applicant is from India

2. Where the Applicant is from Outside India

Let us understand the eligibility in detail

4.1 Where the Applicant is from India

An Applicant, satisfying any of the conditions mentioned below, shall be eligible to make an application for availing incentive under this Scheme:

(a) An entity registered with DPIIT (Department for Promotion of Industry and Internal Trade) as a start-up entity relating to FinTech;

(b) An entity incorporated as a company under the Companies Act 2013, or as a Limited liability Partnership (LLP) under the Limited liability Partnership Act, 2008 or a ‘Branch’ of an Indian company or LLP in IFSC;

(c) An Individual who is a resident citizen; or

(d) An entity working directly or indirectly in the ecosystem regulated by RBI, SEBI, IRDAI or PFRDA.

4.2 Where the Applicant is from Outside India

An Applicant, satisfying any of the conditions mentioned below, shall be eligible to make an application for availing incentive under this Scheme:

A Non-resident Individual or an entity from FATF compliant countries/jurisdictions;

Provided that where the applicant is a body corporate incorporated outside India, the shareholding of non-resident Individuals in the applicant, shall, at all times, be more than 51%.

5. What kind of incentives will be given to eligible applicant?

As per the scheme following 6 kinds of Incentives will be given to the eligible applicants

(a) FinTech Start-up grant

(b) Proof of Concept (PoC) grant

(c) Sand-box grant

(d) Green FinTech Grant

(e) Accelerator Grant

(f) Listing Support Grant

6. How the scheme will be executed?

(a) Firstly, the applicant shall make the application in such a form and manner as prescribed by the authority.

(b) On receipt of the application authority will scrutinize the application and conduct due diligence that the applicant is complying with all the requisite norms.

(c) The application will further be evaluated by the Evaluation Committee and the evaluation committee will submit its recommendation along with comments to the authority.

(d) The authority after being satisfied will issue the sanction letter containing terms & conditions of the grant.

(e) Further the Internal Committee shall monitor pre and post disbursement conditions, compliance, end-use of the grant, progress, milestone achievements and shall perform any other function.

Disbursement shall be made subject to compliance of the specified conditions. Further, the authority may specify detailed guidelines for the implementation of this Scheme.

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied