SUMMARY
Under the pact, an International Fintech Institute will be established to boost and incubate the fintech startups and drive research in the sector
The upcoming institute will also collaborate with other industry stakeholders and VC firms to foster fintech startups
At the end of December 2023, GIFT City boasted 95 local and global funds with commitments to the tune of $30 Bn and investments worth $2.93 Bn
The Centre and the Asian Development Bank (ADB) on Thursday (March 14) inked a $23 Mn loan agreement to spur research and innovation in the fintech space at the Gujarat International Finance Tec-City (GIFT City).
Under the pact, an International Fintech Institute (IFI) will be established to boost and incubate fintech startups and drive research in the sector. As per an official statement, the institute will double as an incubator and accelerator to support homegrown fintech startups, especially women-led ventures.
In addition, the upcoming institute will also collaborate with other industry stakeholders and venture capital (VC) firms to foster fintech startups.
The agreement was signed by economic affairs joint secretary Juhi Mukherjee and the officer incharge of ADB’s India Resident Mission Rajesh Vasudevan.
“The project’s emphasis on market-driven fintech skills programmes, creating (an) enabling environment for private sector investment and enhancing collaboration between industry, skills development institutes and development partners will promote holistic growth of (the) fintech ecosystem in India,” said ADB’s Vasudevan.
The IFI, which will be established in partnership with “globally reputed” institutes, will also offer industry-aligned fintech training programmes. The loan agreement will also look to support research in areas such as climate fintech, regulatory technology, social inclusion, and gender equality in finance.
“The project will help establish a state fintech readiness index and develop new solutions to emerging technologies,” the statement added.
The development comes as the government has pulled all stops to ensure the GIFT City project is a success. In January, the Centre notified the rules for the direct listing of Indian companies on the exchanges of the GIFT City. On a previous occasion, finance minister Nirmala Sitharaman termed the IFSC at the GIFT City as a “gateway for global capital and financial services for the economy”.
The finance hub offers a 10-year tax holiday for companies setting up bases there and zero taxes on the transfer of funds from overseas jurisdictions. This has resulted in fund management activities picking up at the GIFT City.
At the end of December 2023, the City boasted of 95 local and global funds with commitments to the tune of $30 Bn and investments worth $2.93 Bn. Just last month, it was reported that sovereign wealth fund Abu Dhabi Investment Authority was looking to establish a $4.5 Bn fund to invest in India via the City.
