Financial metamorphosis

The financial services sector is undergoing a profound metamorphosis, spurred by technological advancements, evolving customer expectations, and the emergence of innovative business models (Bueno et al., 2024).

- DR MANIK CHAKRABORTY, ST. XAVIER’S UNIVERSITY, KOLKATA AND PALLAVI BANERJEE, ST. XAVIER’S UNIVERSITY, KOLKATA.

Traditional banking systems, characterized by brick-and-mortar branches and conventional service delivery, are increasingly challenged by the agility and customer-centricity of FinTech companies (Chen, 2024). The forces of liberalized capital markets, cross-border trade expansion, technological innovation, and evolving customer expectations have rendered traditional banking practices insufficient to meet modern demands. In response to these dynamics, International Financial Services Centres (IFSCs) have emerged worldwide as hubs designed to deliver a full suite of international financial services in a single jurisdiction, often with regulatory incentives and advanced infrastructure. These centres aim to attract global capital, foster innovation, and position their host countries as competitive players in international finance. This approach is best demonstrated by Gujarat International Finance Tec-City (GIFT infrastructure, a forward-thinking regulatory framework, and services catered to international clientele. By looking at the theoretical framework behind IFSCs, analysing the main drivers, evaluating the opportunities and challenges presented by IFSCs, and talking about its effects on India’s financial sector, this paper investigates the shift from brick-and-mortar banking to globally integrated Click-and-Conquer banking. Policymakers, business executives, and academics can recognise the strategic imperatives for guaranteeing India’s continued competitiveness in the global financial arena by comprehending this change.

International Financial Services Centres - A theoretical framework