The International Financial Services Centres Authority on 11th November 2021 has clarified that the Authority does not mandate any Minimum Holding Period (MHP) requirement pertaining to sale/transfer of loan assets(by any means)by/to IFSCA banking unit (IBU).
IBUs undertaking such transactions are advised to undertake necessary due diligence and,if felt necessary, insert necessary provisions in the agreement to protect its interest such as for retention of a part of the asset or portfolio by the seller and/or minimum period of retention of the asset or portfolio by the seller prior to transfer(i.e.MHP). The IBUs may also put in place a policy for determining the MHP requirement for such transactions.
