The International Financial Services Centres Authority (IFSCA) revised the credit rating framework for the International Financial Services Centre in GIFT City, Gujarat, through Circular No. IFSCA-CMIR/1/2026-CMIR dated 16 July 2026. The circular amended the Master Circular for Credit Rating Agencies in the IFSC dated 5 August 2025 and became effective immediately.
International Financial Services Centre Framework
An International Financial Services Centre (IFSC) is a designated financial zone that provides services to residents and non-residents under a separate regulatory framework. GIFT City, or Gujarat International Finance Tec-City, is India’s first operational IFSC and functions under the regulatory jurisdiction of the IFSCA.
Credit Rating Agencies and Rating Actions
Credit Rating Agencies (CRAs) assess the creditworthiness of debt instruments, issuers, and financial obligations. Under the revised framework, CRAs must disseminate rating actions with a rationale and must allow issuers to review factual errors before publication of the rating. The issuer review requirement applies only to factual errors and does not extend to unsolicited ratings or private credit rating assignments. The circular keeps the publication process linked to documented reasoning and factual verification before release.
Record-Keeping and Regulatory Alignment
The revised framework introduces stricter record-keeping requirements for CRAs. The records must be accurate, detailed, and comprehensive enough to reconstruct the credit rating process, including summaries of material considerations and analytical reasoning. The records must be maintained in line with the IFSCA (Capital Market Intermediaries) Regulations, 2025. The framework also aligns the IFSC credit rating regime more closely with standards associated with the International Organisation of Securities Commissions (IOSCO).
Important Facts for Exams
- The International Financial Services Centres Authority was established under the International Financial Services Centres Authority Act, 2019.
- GIFT City stands for Gujarat International Finance Tec-City.
- Credit Rating Agencies assign ratings to debt instruments and issuers based on credit risk assessment.
- IOSCO is an international body associated with securities market regulation and standards.
Regulatory Scope in IFSC
The IFSC framework in India covers financial services such as banking, insurance, capital markets, and fund management. The IFSCA acts as the unified regulator for financial products, services, and institutions in the IFSC.
