NEW DELHI: MUFG Bank will be the first Japanese bank to open a branch at Gujarat International Financial Tech City (GIFT City) in a bid to offer a wide range of banking services to both domestic and global clients.
MUFG Bank has obtained necessary approvals from the International Financial Services Centre Authority in India and the Financial Services Agency in Japan, to open a branch at GIFT City. MUFG had opened its first branch in Mumbai in 1953.
"With the setup of a GIFT Branch, MUFG can support its domestic as well as global clients with an expanded suite of financial services and respond to their needs in carrying out international transactions," the bank said. MUFG plans to open this branch for operations by the first half of FY 2022.
GIFT City, Gujarat was established as a special economic zone as an International Financial Services Centre (IFSC) for offshore transactions as part of the government's vision to make India a hub for international financial services.
It allows banks and investors to return business back to India, which is currently in offshore countries.
"With this important addition, the international banking ecosystem in GIFT City will further strengthen, showcasing the rising significance of GIFT IFSC. We are confident that other Japanese financial institutions would also consider marking their presence in GIFT City," Tapan Ray, MD & Group CEO GIFT City said.
In India, foreign currency-denominated loans are prohibited in principle based on regulations, while GIFT City provides an opportunity to book India-linked offshore business on the shores of India thereby expanding the business.
"India is attracting a lot of foreign investors and we are keen to contribute to the growth through our new office in GIFT City. As we scale up our presence, we hope to better serve our global clients and be more relevant to them," Shashank Joshi, Deputy CEO of India, MUFG Bank said.
In March this year, MUFG announced the setting up of an investment fund totalling USD 300 million for startups in India, aiming to further contribute to the development of clients in India. This fund intends not only to financially support Indian economic growth but to drive collaboration between MUFG and promising companies in the areas of tech and IT.