Family offices, used by the rich to park some of their wealth overseas, have found a policy patron in the GIFT City regulator amid a broader, unstated dilemma of allowing unchecked outflows of money. The International Financial Services Centres Authority (IFSCA) is learnt to have approached the ministry of finance and RBI to explore regulatory changes that could pave the way for setting up family offices in GIFT City. This move comes as a response to the concern of allowing unchecked outflows of money, providing family offices with a policy patron in the GIFT City regulator.

The establishment of family offices in GIFT City can offer various benefits to wealthy individuals. Family offices serve as a means for the wealthy to manage and preserve their wealth in a more organized and efficient way. By providing a regulated framework for family offices, GIFT City can attract more high net worth individuals to utilize the financial services offered.

Additionally, the move to explore regulatory changes for family offices aligns with the government’s objective of developing GIFT City as a global financial hub. GIFT City, located in Gujarat, India, aims to become a major financial center by offering world-class infrastructure and a favorable business environment. Introducing family offices within the city would further enhance its appeal to both domestic and international investors.

However, the establishment of family offices also raises concerns about potential outflows of money from the country. Family offices can be used as a vehicle to park and invest large amounts of wealth outside of India, which may impact the country’s economy. To address this concern, the IFSCA’s approach to the Ministry of Finance and RBI indicates a proactive effort to regulate family offices and ensure that their operations align with the country’s financial policies.

Overall, the move to explore regulatory changes for the establishment of family offices in GIFT City demonstrates the growing importance of such entities in managing and preserving the wealth of high net worth individuals. With the support of the IFSCA and potential regulatory changes, family offices can contribute to the development of GIFT City as an attractive destination for wealth management services.