INDIA: Cabinet Approves Foreign Investment in other Financial Services Sector

Friday August 12 2016

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi has given its approval to amend Regulations for foreign investment in the Non- Banking Finance Companies (NBFCs).

The amendment in the existing Foreign Exchange Management (Transfer or Issue of Security by the Person Resident Outside India) Regulations on Non- Banking Finance Companies (NBFCs) will enable the inflow of foreign investment in “Other Financial Services” through the automatic route, provided such services are regulated by financial sector regulators (RBI, SEBI, PFRDA etc.) / Government Agencies. Foreign investment in “Other Financial Services”, which are not regulated by any regulators / Government Agency, can be made through the approval route.

Furthermore, minimum capitalisation norms as mandated under the Foreign Direct Investment (FDI) policy have been eliminated as most of the regulators have already fixed minimum capitalisation norms.

Click on the link above for further details.