JPMorgan Chase & Co. is in discussions with over 100 multinational companies to explore banking and payment solutions in India’s GIFT City, according to a report by Livemint. The interest is expected to grow over the next 12 to 18 months as firms seek to establish corporate treasury operations in the financial hub.
Growing Interest in GIFT City
Guhaprasath Rajagopal, managing director and head of payments at JPMorgan India, stated that the surge in inquiries is unprecedented. He noted that treasury centers are a significant focus for GIFT City, which offers advantages such as foreign-currency accounts and a 20-year tax holiday that began in April. The Gujarat International Finance Tec-City, or GIFT City, aims to compete with global financial centers like Dubai and Hong Kong by providing exemptions from certain taxes and regulatory restrictions.
As of September, banking assets in GIFT City have doubled to over $100 billion compared to two years prior. Currently, there are 10 operational corporate treasury centers in the area, including those for AMNS Global and Amefird Treasury. Rajagopal mentioned that multinational firms are conducting significant internal evaluations to establish their presence in this growing market.
Opportunities for Banks
The expansion of treasury operations is creating new opportunities for banks to offer liquidity-management services. JPMorgan provides various services, including physical pooling and cash concentration, as global companies increasingly centralize their cash and funding operations. Rajagopal emphasized that this trend is likely to continue as more firms recognize the benefits of operating in GIFT City.
The development is likely to impact financial services sectors, particularly banking and payments, as JPMorgan and other banks expand their offerings in India’s GIFT City. Increased corporate treasury operations could lead to higher demand for liquidity-management services and related financial products.
Investors will watch for further announcements from JPMorgan regarding specific partnerships and the operational status of new treasury centers in GIFT City.