The answer to who regulates AIF and PMS in India depends on where the fund is established and what activity it carries out. In India’s domestic securities market, the Securities and Exchange Board of India (SEBI) regulates Alternative Investment Funds (AIFs) and Portfolio Management Services (PMS). Funds established in GIFT City’s International Financial Services Centre (IFSC) fall under the International Financial Services Centres Authority (IFSCA). The Reserve Bank of India (RBI) oversees banking and foreign-exchange matters, including relevant investment routes under FEMA.
These regulators have distinct responsibilities. A domestic AIF does not become an IFSCA-regulated fund simply because it invests overseas, and a GIFT City fund is not automatically a SEBI-registered AIF. Understanding who regulates AIF and PMS in India helps investors identify the right registration, regulatory framework and investor route before committing money.
Key Details: SEBI, IFSCA and RBI at a Glance
| Parameter | SEBI | IFSCA | RBI |
| Full name | Securities and Exchange Board of India | International Financial Services Centres Authority | Reserve Bank of India |
| Main jurisdiction | Indian securities market | Financial services in India's IFSCs | Banking, monetary policy and foreign exchange |
| Fund-related role | Regulates domestic AIFs and PMS providers | Regulates fund management entities and schemes in GIFT-IFSC | Administers relevant FEMA rules and foreign-exchange directions |
| Key framework | SEBI AIF and Portfolio Managers Regulations | IFSCA Fund Management Regulations, 2025 | FEMA, rules, regulations and RBI directions |
| Typical fund location | Domestic India | GIFT-IFSC and other Indian IFSCs | Not a fund-registration authority for AIFs or PMS |
| Investor relevance | Domestic securities products and intermediaries | IFSC-based financial products and services | Banking channels, remittances and foreign-exchange compliance |
The central distinction is that who regulates AIF and PMS in India is primarily a SEBI question for domestic products, while IFSCA applies to funds operating within an IFSC framework. RBI's role is different: it governs banking and foreign-exchange aspects rather than registering domestic AIFs or PMS providers.
Who Regulates AIFs and PMS in India?
For domestic Indian AIFs and PMS, SEBI is the principal regulator. It frames the applicable regulations, registers eligible entities, prescribes operating and disclosure requirements, and supervises regulated market participants.
The AIF regulator in India is SEBI under the SEBI (Alternative Investment Funds) Regulations, 2012. The PMS regulator in India is also SEBI, under the SEBI (Portfolio Managers) Regulations, 2020, which remain the applicable framework until the 2026 regulations take effect.
This means the answer to who regulates AIFs in India and who regulates PMS in India is SEBI when the product and service provider operate under the domestic framework.
However, the answer changes for a fund established in GIFT-IFSC. Such a fund may be regulated by IFSCA under its fund management framework. RBI may also become relevant when the transaction involves foreign exchange, banking channels or FEMA-governed investment routes.
Who regulates AIF and PMS in India therefore cannot be answered by looking only at a fund's name or investment strategy. Its legal domicile, registration category, manager and operating structure matter.
What Does SEBI Regulate for Domestic AIFs and PMS?
SEBI is India's securities market regulator. Its responsibilities include investor protection, regulation of market intermediaries and oversight of securities-market activities.
SEBI Regulations for AIFs
The SEBI (Alternative Investment Funds) Regulations, 2012 govern domestic AIFs. These regulations cover matters such as:
- Registration and eligibility of an AIF.
- Classification into Category I, Category II and Category III.
- Fund structure, corpus and investment conditions.
- Sponsor and manager obligations.
- Placement memorandum and investor disclosures.
- Investment restrictions and operational requirements.
- Reporting, compliance and winding-up provisions.
The three AIF categories broadly reflect the nature of their investment strategies:
| Category | Broad investment focus |
| Category I | Start-ups, early-stage ventures, SMEs, infrastructure and other specified sectors |
| Category II | Funds that do not fall under Category I or Category III and generally do not use leverage except as permitted |
| Category III | Funds using diverse or complex trading strategies, including permitted leverage |
The latest SEBI AIF Regulations available as of October 30, 2026, are amended up to October 15, 2026. Investors can access the SEBI AIF Regulations, 2012.
A SEBI registered AIF must have the relevant registration for its fund category. A fund manager's general corporate registration or a distributor's association with the product does not replace the fund's regulatory status.
For further information on the structure and categories of domestic AIFs, investors can explore ALTPORT's Alternative Investment Funds in India page.
SEBI Regulations for PMS
PMS is a service in which a registered portfolio manager manages a client's portfolio under an agreed mandate. Unlike an AIF, where investors participate in a pooled vehicle, PMS generally involves a separately managed client portfolio.
The current SEBI (Portfolio Managers) Regulations, 2020 framework addresses:
- Registration of portfolio managers.
- Eligibility and net-worth requirements.
- Client agreements and disclosure documents.
- Investment management responsibilities.
- Custody and handling of client assets.
- Fees, reporting and compliance.
- Investor grievance and regulatory obligations.
SEBI's 2020 PMS Regulations were last amended on September 3, 2025. SEBI notified a new set of Portfolio Managers Regulations in October 2026, but these are scheduled to take effect from April 1, 2027. Until that date, the 2020 framework remains relevant.
Read the SEBI Portfolio Managers Regulations, 2020 and the SEBI regulations listing for the upcoming framework.
The PMS regulator in India is therefore SEBI, and a SEBI registered PMS provider must hold the relevant registration to carry out portfolio management services.
Investors can learn more about the product structure through ALTPORT's Portfolio Management Services in India page.
What Does IFSCA Regulate for Funds in GIFT City?
IFSCA stands for the International Financial Services Centres Authority. It was established under the IFSCA Act, 2019, to regulate and develop financial services within India's International Financial Services Centres.
GIFT City in Gujarat hosts India's operational IFSC. Fund management entities operating within this jurisdiction come under IFSCA's regulatory framework.
What Is IFSCA Responsible For?
IFSCA regulates financial products, services and institutions operating in an IFSC. Its responsibilities include fund management, capital market activities, banking, insurance and other permitted financial services within the IFSC framework.
For funds, the principal framework is the IFSCA (Fund Management) Regulations, 2025, which replaced the earlier 2022 regulations. The regulations cover:
- Registration and authorisation of Fund Management Entities (FMEs).
- Fund and scheme structures.
- Venture capital schemes and restricted schemes.
- Retail schemes and other permitted fund categories.
- Eligibility, governance and compliance requirements.
- Investor disclosures and reporting.
- Custody, valuation and operational obligations.
The current consolidated regulations were amended up to September 10, 2026. Investors can access the IFSCA Fund Management Regulations and updates.
A fund established and authorised under this framework is an IFSCA-regulated fund. It is not automatically a SEBI-registered AIF, even if its strategy resembles a domestic AIF.
This distinction is central to who regulates AIF and PMS in India when investors compare domestic investment products with GIFT City structures.
Who Regulates Investment Funds in GIFT City?
IFSCA is the regulator for fund management entities and authorised schemes operating in GIFT-IFSC. It maintains lists of registered Fund Management Entities and authorised schemes or funds.
Investors can use the official IFSCA Fund Management page to access the relevant lists and regulatory updates.
A fund's presence in GIFT City, a foreign-currency denomination or an international investment strategy does not independently establish regulatory approval. The relevant FME and scheme authorisation must be checked.
Are GIFT City Funds Regulated by SEBI or IFSCA?
GIFT City funds established under the IFSC fund management framework are regulated by IFSCA, not registered as domestic SEBI AIFs merely because they follow a similar investment strategy.
Domestic AIFs fall under SEBI's AIF Regulations, 2012. IFSC schemes fall under the IFSCA Fund Management Regulations, 2025.
However, a domestic fund manager may have separate operations or entities in both jurisdictions. Each entity and fund must be evaluated under its own regulatory framework.
What Is the RBI's Role in Banking, FEMA and Investment Routes?
RBI is India's central bank. It regulates banks and oversees foreign-exchange management under the Foreign Exchange Management Act, 1999 (FEMA), along with other statutory responsibilities.
RBI does not generally register domestic AIFs or PMS providers. Its role becomes relevant when an investment involves foreign exchange, cross-border remittances, banking channels or FEMA compliance.
What Does RBI Regulate?
Relevant RBI responsibilities include:
- Banking and authorised dealer operations.
- Foreign-exchange transactions under FEMA.
- Overseas investment by persons resident in India.
- Permitted remittance routes and reporting requirements.
- Foreign-exchange directions applicable to authorised persons and banks.
For example, an Indian resident investing overseas may need to follow the Overseas Investment Rules, Regulations and RBI directions. A non-resident investing in Indian securities may be subject to the applicable FEMA framework, including rules governing non-debt instruments and reporting.
RBI Role in NRI Investments
NRI investments can involve different routes depending on the investor's residential status, asset class, repatriation requirements and investment structure.
The relevant framework may include:
- Foreign Exchange Management (Non-Debt Instruments) Rules, 2019.
- Foreign Exchange Management (Mode of Payment and Reporting of Non-Debt Instruments) Regulations, 2019.
- Applicable RBI directions and authorised dealer bank procedures.
The RBI's role is particularly important for remittances, account operations and foreign-exchange compliance. It does not replace SEBI or IFSCA as the regulator of a fund merely because an NRI invests in it.
The RBI role in NRI investments should therefore be understood separately from the regulator responsible for the investment product itself.
Read the RBI Foreign Exchange Management resources for applicable notifications and directions.
SEBI vs IFSCA vs RBI: Regulator, Product and Investor-Route Comparison
The SEBI vs IFSCA distinction is primarily about jurisdiction and the financial activity being regulated. SEBI oversees domestic securities-market products and intermediaries, while IFSCA regulates financial services within IFSCs.
The IFSCA vs SEBI comparison becomes relevant when an investor evaluates a domestic AIF against a GIFT City fund. The SEBI vs RBI distinction is different: SEBI regulates securities-market participants, while RBI oversees banking and foreign-exchange matters. Similarly, IFSCA vs RBI is a comparison between the IFSC's financial-services regulator and the central bank's banking and FEMA responsibilities.
| Comparison | SEBI | IFSCA | RBI |
| Domestic AIF | Regulates | Not the primary regulator | Not the fund regulator |
| Domestic PMS | Regulates | Not the primary regulator | Not the PMS regulator |
| GIFT-IFSC fund | Not ordinarily the primary fund regulator | Regulates | May govern relevant banking/FEMA aspects |
| Banking | Not the banking regulator | Regulates banking activities within IFSC | Regulates banking system |
| Foreign exchange | Securities-related framework may intersect | IFSC framework applies within its jurisdiction | FEMA administration and directions |
| Registration to check | AIF or portfolio manager registration | FME and scheme authorisation | Relevant bank/authorised dealer and FEMA compliance |
The financial regulators in India have overlapping areas of interaction, but their legal mandates are not interchangeable. A fund can operate within one regulatory framework while its investors' transactions may also need to comply with another regulator's rules.
Which Regulator Applies to Domestic AIFs, PMS and GIFT City Funds?
The answer to who regulates AIF and PMS in India becomes clearer when the product's legal structure is identified.
| Investment structure | Primary regulator | Regulatory framework |
| Domestic Category I AIF | SEBI | SEBI AIF Regulations |
| Domestic Category II AIF | SEBI | SEBI AIF Regulations |
| Domestic Category III AIF | SEBI | SEBI AIF Regulations |
| Domestic PMS provider | SEBI | SEBI Portfolio Managers Regulations |
| GIFT-IFSC fund | IFSCA | IFSCA Fund Management Regulations |
| Banking and foreign-exchange transaction | RBI, as applicable | Banking laws and FEMA framework |
A domestic AIF vs GIFT City fund comparison should not focus only on the investment strategy. The legal domicile, fund vehicle, manager registration, eligible investors, currency, tax treatment and applicable compliance framework also matter.
For example, a domestic Category II AIF and an IFSC restricted scheme may both invest in private companies, but they do not operate under the same regulations. The GIFT City fund regulator is IFSCA for schemes established under its IFSC framework.
This is why who regulates AIF and PMS in India should always be answered by identifying the actual fund structure rather than relying on marketing descriptions.
How to Verify a Fund's Registration and Regulatory Status
Investors should check the legal entity and the specific fund or scheme, not just the brand name.
For a Domestic AIF
To understand how to verify AIF registration, follow these steps:
- Obtain the fund's full legal name and category.
- Ask for its SEBI registration details.
- Check the fund or manager details against SEBI's official records.
- Read the placement memorandum and contribution agreement.
- Confirm the registered manager, trustee and other relevant parties.
- Check whether the fund's category and proposed activities match its registration.
Use SEBI's official website and its intermediary and regulatory records to check the registration status.
For a PMS Provider
To check a SEBI registered PMS, obtain the portfolio manager's legal name and registration number. Compare these details with SEBI's portfolio manager records. Review the disclosure document and client agreement to understand the service mandate, fees and responsibilities.
For a GIFT City Fund
To understand how to check fund regulatory status in GIFT City:
- Obtain the Fund Management Entity's legal name.
- Check whether the FME appears in IFSCA's registered entity list.
- Confirm that the specific scheme or fund is authorised.
- Review the placement memorandum and investor eligibility conditions.
- Match the scheme name, manager and authorisation details.
The IFSCA regulated funds and registered entities can be checked through the official IFSCA Fund Management section.
Do not treat a distributor's registration, a group's regulatory status or a fund manager's general business licence as proof that a specific fund is authorised.
What Investors Should Check Before Investing
Understanding who regulates AIF and PMS in India is only the first step. Regulatory registration does not guarantee returns, capital protection or suitability.
Before investing, examine these points:
- Legal structure: Is the investment a domestic AIF, PMS account or IFSC scheme?
- Regulatory status: Which regulator has authorised the fund or service provider?
- Fund documents: Do the placement memorandum and agreements clearly explain the strategy and risks?
- Investor eligibility: Are you eligible under the applicable domestic or IFSC rules?
- Investment mandate: What can the manager invest in, and what restrictions apply?
- Fees and expenses: Check management fees, performance fees, operating costs and exit charges.
- Liquidity: Understand lock-ins, redemption windows and transfer restrictions.
- Tax and currency: Review tax treatment, reporting and currency exposure with a qualified professional.
- Service providers: Identify the manager, trustee, custodian, administrator and auditor, where applicable.
The regulatory framework for alternative investment regulations in India and GIFT-IFSC is designed around different jurisdictions and product structures. Investors should understand both the fund's regulator and the rules applicable to their own investment route.
Make Informed Investment Decisions with ALTPORT
At ALTPORT, we believe investors should understand the structure behind an investment before evaluating its potential. Whether you are exploring a domestic AIF, a PMS strategy or an IFSC-based fund, knowing the applicable regulator is an important part of that decision.
We help investors explore investment opportunities and access relevant product information through our investment distribution platform. Our approach is to make product structures, investment details and applicable disclosures easier to understand.
Explore investment opportunities on ALTPORT and review the relevant product information before making an investment decision. The right starting point is not just the fund's strategy; it is also its regulatory status, structure, costs and suitability for your financial objectives.
Disclaimer
This article is for educational and informational purposes only. It does not constitute investment, legal, tax or regulatory advice, or a recommendation to invest in any fund or product. Regulatory requirements may change. Investors should refer to the applicable regulations, scheme documents and official regulator records and consult qualified professionals where necessary. Investments in AIFs, PMS and GIFT City funds involve risks, including possible loss of capital.