The three categories
No entity may carry on fund management in GIFT IFSC without a certificate of registration as an FME in one of the categories in regulation 3(4) of the IFSCA (Fund Management) Regulations, 2025 (the FM Regulations). The application is made through IFSCA's Single Window IT System (SWIT) with the declarations in the First Schedule.
- Authorised FME. Pools money from accredited investors, or investors investing above the specified threshold, by private placement into venture capital schemes. A single family may also set up an Authorised FME to manage its own family investment fund.
- Registered FME (Non-Retail). Runs restricted schemes for accredited or above-threshold investors, offers portfolio management services (including for a multi-family office) and may act as investment manager for privately placed REITs and InvITs. It may also do everything an Authorised FME may do.
- Registered FME (Retail). Runs retail schemes open to all investors or a section of them, launches exchange traded funds and may manage publicly offered REITs and InvITs, in addition to all Non-Retail and Authorised activities.
Side by side
| Authorised FME | Registered FME (Non-Retail) | Registered FME (Retail) | |
|---|---|---|---|
| Main products | Venture capital schemes; a single family's family investment fund | Restricted schemes; portfolio management; private REITs and InvITs | Retail schemes; ETFs; public REITs and InvITs |
| Minimum net worth (Second Schedule) | USD 75,000 | USD 500,000 | USD 1,000,000 |
| Key managerial personnel (regulation 7) | Principal officer | Principal officer and compliance officer | Principal officer, compliance officer and, before the first retail scheme or ETF is filed, a KMP responsible for fund management |
| Legal form (regulation 5) | Company, LLP or branch | Company, LLP or branch | Company only; at least four directors, half of them independent |
| Track record (regulation 6) | Relevant experience of employees | Relevant experience of employees | Five years of fund management at the stated scale, by the FME group or by its controlling persons |
A branch is available only to an entity already registered or regulated for similar activities by a financial sector regulator in India or in a foreign jurisdiction. The parent must ring-fence the branch's operations and earmark the required capital, which may be held in its home jurisdiction (regulations 5(2) and 8(2)). A family investment fund is outside the legal form and net worth rules altogether (regulation 104(2)); see family investment funds.
Requirements that apply to every category
- People in GIFT City. The principal officer and the other required KMPs must be based out of the IFSC and meet the qualification and experience tests in regulation 7(5). These were recast with effect from 30 January 2026 to recognise experience in an "eligible institution" and specified certifications.
- Decisions in GIFT City. The proposal on the portfolio composition of a fund must be initiated by a person based in the FME's IFSC office (regulation 7(7)). At registration the FME also declares that investment decisions, portfolio management and grievance handling will be undertaken from the IFSC.
- Larger managers. An FME with assets under management of at least USD 1 billion at a financial year end, excluding fund of funds schemes, must appoint an additional fund management KMP within six months (regulation 7(4)).
- Fit and proper. The FME, its principal officer, directors or partners, KMPs and controlling shareholders must be fit and proper at all times (regulation 9).
- Office. The office must be dedicated, secured and accessible only to authorised persons of the FME (regulation 10).
- Net worth at all times. The FME net worth is separate from, and additional to, capital required for any other activity inside or outside the IFSC (regulation 8(3)).
KMPs and staff in core fund management roles must also complete an IFSCA-specified certification course. See fund governance and KMP certification.
Choosing, and changing, the category
Start from the products and investors in the business plan for the next few years, not the first scheme. An FME cannot change its category without IFSCA's prior approval (regulation 13(2)), so a manager that expects to offer portfolio management or restricted schemes soon after a venture capital scheme usually registers as a Registered FME (Non-Retail) from the outset.
Points that commonly decide the question:
- Retail ambitions. A foreign manager entering through a branch cannot hold Retail registration. Retail activity needs an IFSC company, which can sit alongside a Non-Retail branch.
- Third-party platforms. Managing schemes for other managers needs a separate authorisation, an extra USD 500,000 of net worth and a company or LLP. See third-party fund management.
- Fees. IFSCA's application, registration and recurring fees differ by category. See fees.
For the overall FME framework and how the entity choice interacts with tax, see our Fund Management Entity guide.