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Family Office Trends: How Indian Family Wealth Continues to Move Abroad

15 June 2023

The global economy has made it possible for businesses to move to a jurisdiction of their choice to pursue better opportunities. As countries around the world compete for international businesses, those that are not able to offer the necessary incentives risk losing out. Although India has previously enjoyed the immense wealth generated by family offices, this is beginning to change.

More and more, wealthy Indian families are moving their business abroad, taking their wealth with them. Competitive business opportunities and product offerings are causing firms to leave India, and this trend looks likely to continue in 2023.

The value of Wealth Management Opportunities

One major appeal to wealthy Indian families looking to move their firm abroad is the vast array of wealth management opportunities offered by the global economy. The Outward Direct Investment (“ODI”) regulations, which allow Indians to substantially invest in projects, firms and securities abroad, have created intense interest in the Indian Wealth Community. This ability to invest in overseas entities has shifted, as wealthy Indians are now looking not just to invest abroad, but to move their physical company abroad as well.

The main destinations for these families are the USA, the UK and the European Union.

Potential drawbacks to moving companies abroad

  • Problems with raising capital

Arguably the biggest drawback to relocating a business is the need to raise the initial capital to fund the move. Although the USA, the UK and the European Union are attractive destinations for wealthy Indians, this presents the issue of currency conversion. The Indian Rupee is considerably weaker than the Great British Pound, the US Dollar or the Euro. This discrepancy requires Indian businesses to raise considerably higher capital amounts to account for this difference.

Furthermore, these countries likely to be significantly more expensive than India, increasing the required capital even further.

  • Problems with opening a new bank account

The difficulties associated with moving firms abroad do not end with raising capital. Another drawback is the difficulty of opening a new bank account. Some people may simply not even be able to get one. Even for those who are able to open an account, the process can be very time consuming. Time is a crucial resource, and losing it can provide the market space for other firms to grow in size.

  • Problems with finding the right family office service provider

The final major drawback to relocating to another country is having to go through multiple providers to meet your family office needs. This can cost you even more time, resulting in the loss of potential business opportunities.

In addition to the loss of time, choosing the wrong provider may result in your business running afoul of regulations. This can cause severe reputational damage, which can be very difficult to recover from. Your firm’s name can open or close doors, so it is important that your company is highly regarded.

How we can help you

At Apex Group, we understand that there is no one-size-fits-all approach to family offices. That’s why it’s important for us to get to know our clients. Our family office services are tailored to your specific circumstances, and cover everything including governance, succession, reporting, administration and financial solutions. Why deal with the hassle and cost of multiple providers when you can access everything you need in one place?

We are trusted by companies worldwide to help them manage their finances, so you can rest assured that your finances are in safe hands. Finally, we can save your firm valuable time, as we can open your bank account within 5 days of receiving the relevant documents.

You’ve worked hard, and so has your family. So let us take care of your family office needs. After all, you deserve to focus your time and energy on what really matters to you.

 

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