IFSCA
IFSCA likely to release guidelines for listing CPs, CDs in GIFT City in 3 weeks: Report
Ahmedabad/IBNS: The International Financial Services Centres Authority (IFSCA) is expected to introduce regulations for listing commercial papers (CPs) and certificates of deposit (CDs) on the GIFT City exchange within the next three weeks, Moneycontrol reported, citing its sources.
"All comments have been received, and the authority is now reviewing the feedback. The final regulations are expected to be issued in about three weeks," one source told Moneycontrol.
Earlier this month, IFSCA, which oversees financial products, services, and institutions in GIFT City, published a consultation paper.
The paper invited input from stakeholders and the public on the listing guidelines for CPs and CDs on exchanges in the International Financial Services Centre (IFSC).
The deadline for submitting comments was Sept. 17, as per reports.
The draft circular indicated that these guidelines aim to attract foreign investors, further developing the market.
It also mentioned that these norms would allow access to a broader and more diverse pool of investors, potentially increasing demand and reducing borrowing costs for issuers, reports Moneycontrol.
Issuers will be required to meet IFSCA's initial and ongoing disclosure standards, Moneycontrol reported, adding that the increased transparency is expected to enhance investor trust and credibility.
The consultation paper also noted that the listing of CPs and CDs within the IFSC would fall under IFSCA's regulatory supervision, offering added protection for investors.
In August, fundraising through CPs grew by 22 percent year-on-year, as corporates leaned toward this method due to rising costs of bank loans, driven by increased marginal cost of funds-based lending rates (MCLR), according to reports.
CD issuances also surged by 44 percent in August, driven by slower deposit growth at banks and the rollover of maturing papers.
According to Prime Database, banks raised Rs 82,020 crore through CDs in August, up significantly from Rs 57,170 crore in August 2023.
Similarly, businesses raised Rs 1.40 lakh crore in August, compared to Rs 1.15 lakh crore in the same month last year, and Rs 1.05 lakh crore in July, reports Moneycontrol.
The top five issuers, including Reliance Retail Ventures, the National Bank for Agriculture & Rural Development (NABARD), Reliance Industries, Reliance Jio Infocomm, and ICICI Securities, accounted for 30 percent of the total funds raised, according to Moneycontrol.
As per data, Reliance Retail raised Rs 13,275 crore, NABARD Rs 9,700 crore, Reliance Industries Rs 7,000 crore, Jio Rs 5,825 crore, and ICICI Securities Rs 5,685 crore.
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