The Dubai Financial Services Authority (DFSA) has issued a decision restricting the Dubai International Financial Centre (DIFC) branch of HDFC Bank Limited from onboarding or soliciting new clients while it investigates compliance concerns.
Key Details of the Decision
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The DFSA’s decision notice, effective 25 September 2025, prohibits HDFC DIFC from offering certain financial services to any client who had not fully completed its onboarding process by that date.
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The restrictions include the following activities for new clients:
• Advising on financial products (e.g. securities, structured products)
• Arranging deals in investments
• Arranging credit or advising on credit
• Arranging custody services
• Engaging in financial promotions or soliciting business to new clients -
These restrictions do not apply to existing clients or potential clients who had already started onboarding and had offers extended prior to the cutoff date.
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The DFSA’s public register confirms these restrictions under its regulatory authority as per Article 75(1) of the Regulatory Law 2004 (as amended).
HDFC Bank’s Position & Scale of the Branch
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HDFC Bank has stated that the DIFC branch is not materially significant to the overall business or financials of the bank.
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As of 23 September 2025, the branch was serving 1,489 customers, including joint accounts.
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In a statement, HDFC Bank said it has already initiated steps to comply with the DFSA’s directives and will cooperate fully during the regulatory review.
Possible Catalyst & Regulatory Context
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Media reports suggest the scrutiny may relate to concerns about the adequacy, transparency, or rigor of the branch’s client onboarding processes under DIFC’s stricter regulatory regime.
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Some reports also mention past controversies involving the marketing or sale of Credit Suisse Additional Tier-1 (AT1) bonds to non-resident Indian investors via UAE operations as context for regulatory attention.
Implications & What’s Next
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The DFSA’s move underscores its commitment to upholding investor protection, regulatory compliance, and market integrity in the DIFC as a global financial centre.
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HDFC’s DIFC branch will likely undergo a detailed supervisory review, including examination of its policies, internal controls, risk management, client due diligence, and compliance practices.
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Until the DFSA rescinds or amends the decision notice, HDFC DIFC will be prevented from expanding its client base in the UAE markets.
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The timeline for the resolution or lifting of the restriction remains uncertain, as the DFSA has not publicly disclosed when the decision might be revisited.