According to media reports, major Indian stockbroking platforms Zerodha, Groww, Angel One and Upstox have been granted necessary approvals to use GIFT (Gujarat International Finance Tec) City facilities to enable international and US stock investing.
The services are expected to be launched in the coming two to three months once companies have completed testing, technology integration and regulatory compliance procedures. Lsst week, access to US stocks was also made available by Raise Securities, the company that runs the investment platform Dhan.
Similarly, SAMCO Securities declared on June 11 that it would open its worldwide investment platform for US stocks and exchange-traded funds after obtaining a broker-dealer licence from the IFSCA. The Global Access Provider (GAP) framework was introduced by GIFT City in August last year to give Indians a more affordable and controlled way to invest abroad. Zero withdrawal fees when transferring money to India are one of the framework’s features.
Zerodha and Upstox will act as broker-dealers under the new framework, while Groww and Angel One will be Global Access Providers. Zerodha and Upstox are expected to route transactions through international clearing and execution partners, including ViewTrade International, Interactive Brokers and Alpaca Securities, in order to grant users access to international markets. ViewTrade currently has GAP approval, but the launch of products connected to Interactive Brokers and Alpaca might take longer.
Furthermore, these companies have already formed alliances with significant US brokerage platforms such as Robinhood and Charles Schwab, which can facilitate access to foreign stocks. In order to facilitate cross-border investing, brokers using the GAP model are also expected to collaborate with US brokerage firms.
While Indian companies are starting to give their citizens an opportunity to invest in the United States, foreign companies are also searching for Indian markets through unconventional means. Tryfacta, a US-based company, recently applied to the IFSCA for approval to raise USD 100–150 million through an IPO. It would be the first US-based company to list on the GIFT City markets.
The Reserve Bank of India’s (RBI) Liberalised Remittance Scheme (LRS) and IFSC-registered brokers will allow Indian investors to make investments abroad. The benefits would be conditional upon the rupee-dollar exchange rates and the entire transaction would be conducted in US dollars.
