Net Worth Requirements under IFSCA (CMI) Regulations, 2025

The International Financial Services Centres Authority (IFSCA) introduced the Capital Market Intermediaries (CMI) Regulations, 2025 as a comprehensive framework for entities operating in GIFT City IFSC. A central pillar of this regulation is the IFSCA net worth requirement, designed to ensure that intermediaries maintain adequate financial strength, instill market confidence, and safeguard investor interests.

Originally, entities were required to comply by October 1, 2025; however, IFSCA has extended the deadline to December 31, 2025. This article provides a structured guide to net worth requirements under IFSCA CMI Regulations 2025, compliance principles, and practical FAQs for IFSCA-registered entities.

Why Net Worth Matters in GIFT City Compliance

Net worth under IFSCA is more than a licensing criterion, it is an ongoing compliance standard under IFSCA capital market intermediaries regulations. Maintaining the prescribed levels at all times ensures:

• Financial stability of intermediaries.
• Risk management in volatile capital markets.
• Trust for global investors and regulators.
• Eligibility for registration and renewals under GIFT City net worth requirements.

Defining Net Worth under IFSCA CMI

Standard Formula

For most intermediaries, net worth calculation under IFSCA = paid-up share capital + free reserves – accumulated losses – miscellaneous expenditure not written off.

Special Case: Broker Dealers, Clearing Members, and Investment Bankers

For these categories, liquid net worth under IFSCA must be computed only on the basis of liquid assets, such as:

• Cash and bank balances.
• Fixed deposits.
• Government securities (G-Secs).
• Other instruments permitted by IFSCA.

Excluded items: Revaluation reserves, write-back of depreciation, and amalgamation reserves, in line with IFSCA net worth guidelines.

Minimum Net Worth by Category

The following thresholds are prescribed in Schedule I of the CMI Regulations, 2025:

Global Access Providers (GAPs) – Special Category

The Global Access framework allows intermediaries to provide trading access in international exchanges through GIFT IFSC. For GAPs, specific IFSCA net worth requirements for Global Access Providers are prescribed by IFSCA, which must be:

• Segregated and earmarked for the Global Access activity.
• In addition to any other net worth maintained for other registrations.

Illustratively, higher-tier GAPs are expected to maintain a minimum of USD 500,000, while lighter models have proportionately lower requirements (as per IFSCA circulars).

Key Compliance Principles

1. At all times compliance: Net worth must never fall below prescribed levels under IFSCA net worth requirements.
2. Highest requirement rule: If holding multiple CMI registrations, the entity must maintain the highest applicable net worth.
3. Branch model for foreign parents: Net worth can be maintained at parent level but must be earmarked for the IFSC branch, with documentary evidence for net worth certificate under IFSCA.
4. Separate requirement: CMI net worth is in addition to any domestic or overseas obligations.
5. Record-keeping: Maintain quarterly net worth statements and audited annual financials as evidence for inspections and IFSCA net worth compliance review.

Transition Timeline – Extended to December 31, 2025

• Original deadline: October 1, 2025.
• Extension granted: IFSCA circular extended compliance to December 31, 2025.
• Practical implication: Entities should finalize capital infusions, obtain board approvals, and update compliance records before year-end to meet IFSCA net worth requirements 2025 deadline.

Regulatory Update – International Financial Services Centres Authority Circular on Liquid Net Worth (30 December 2025)

The International Financial Services Centres Authority (IFSCA), through Circular No. IFSCA-PLNP/80/2024–Capital Markets dated 30 December 2025, has issued important clarifications on the computation of liquid net worth under IFSCA CMI Regulations 2025.

This circular provides much-needed operational clarity for IFSC intermediaries, particularly broker dealers and clearing members, by addressing practical challenges related to capital adequacy and regulatory compliance under IFSCA capital market intermediaries regulations.

Key Clarifications Issued by IFSCA

Inclusion of Base Capital and Interest-Free Deposits

The prescribed base minimum capital as well as interest-free deposits maintained with recognised stock exchanges and clearing corporations will be considered as part of an intermediary’s liquid net worth under IFSCA.

Recognition of Margins as Liquid Net Worth

Margins maintained by broker dealers and clearing members for their trading activities, whether under IFSC operations or Global Access arrangements, are eligible to be included in IFSCA liquid net worth calculation.

Exclusion of Liabilities from Net Worth Calculation

In line with the definition under the CMI Regulations, liabilities are to be excluded while calculating net worth. Only qualifying assets are taken into account for determining net worth under IFSCA regulations.

Immediate Applicability

These clarifications are effective immediately and apply uniformly across all relevant IFSC intermediaries.

Regulatory Impact

This clarification significantly strengthens regulatory certainty by ensuring that genuine operational capital, including margins and exchange deposits, is appropriately recognised for compliance purposes. It is particularly beneficial for intermediaries with active trading operations and margin-intensive business models, enabling more accurate and practical IFSCA net worth calculation and compliance assessment.

FAQs on Net Worth Compliance

1. What counts as liquid assets under IFSCA?
   A. Cash, bank balances, fixed deposits, government securities, and other instruments notified by IFSCA, forming part of liquid net worth under IFSCA.
2. How should foreign parent entities earmark net worth for IFSC branches?
   A. By maintaining board-approved allocations and providing supporting documentation that clearly identifies funds reserved for the IFSC branch for IFSCA net worth certificate and compliance purposes.
3. If an intermediary holds multiple registrations, how is net worth calculated?
   A. The entity must comply with the highest net worth requirement among its registrations under IFSCA CMI Regulations 2025.

Expert Insights – Our Experience at N Pahilwani & Associates

With 15+ years of professional service experience, N Pahilwani & Associates has been at the forefront of advisory and compliance in GIFT IFSC, including net worth certificate issuance under IFSCA regulations.

• Experienced team: Chartered Accountants (CAs), Company Secretaries (CS), and Registered Valuers.
• Office presence: GIFT IFSC (Signature Building) and Vadodara, Gujarat
• Practical expertise: Already engaged in issuing IFSCA net worth certificates for capital market intermediaries.
• Trusted partner: Advisory support across compliance, audit, tax and IFSCA capital market intermediaries regulations compliance.

Our experience allows us to provide practical, regulator-aligned solutions for intermediaries navigating IFSCA’s evolving landscape.

Conclusion – Preparing for Net Worth Compliance

The net worth requirement under IFSCA CMI Regulations 2025 is more than a regulatory formality, it is a strategic foundation for credibility and business growth in GIFT City. With the compliance deadline extended to December 31, 2025, now is the time for registered entities to assess readiness, shore up capital buffers, and streamline documentation in line with IFSCA net worth requirements.

Contact N Pahilwani & Associates for a readiness review, IFSCA net worth certificate support, and tailored advisory solutions for seamless compliance with IFSCA net worth requirements.