From India to Australia: Why the Legal Entity Identifier is gaining in importance
5 November 2024
The demand for the Legal Entity Identifier (LEI) is growing worldwide, especially in Asia. The driving force behind this growth is regulatory requirements, which increasingly encourage the introduction and use of the LEI.
LEI: A global standard on the rise
According to the latest report by the Global LEI Foundation (GLEIF), around 67,000 new LEIs were issued worldwide in the third quarter of 2024. This brought the total number of active LEI numbers to over 2.57 million, which corresponds to a growth of 2.7 %. In the Asia-Pacific region, the LEI is becoming the central identifier for companies that must fulfil regulatory requirements.
Regulatory initiatives Accelerate LEI adoption
The increasing adoption of the Legal Entity Identifier in the Asia-Pacific region is closely linked to regulatory requirements. Countries such as Australia and New Zealand have seen remarkable growth rates of 18.7% and 10% respectively. This is mainly due to the updated reporting requirements of the Australian Securities & Investments Commission (ASIC), which make the LEI mandatory for over-the-counter derivatives transactions.
Momentum is also increasing in India. In the third quarter, the issuance of LEIs rose by 9.9 %. GLEIF responded by opening an office in Mumbai to further promote the local dissemination and use of LEI numbers.
LEI renewal promotes transparency and data quality
The global LEI renewal rate now stands at 56.1%. In India, one of the pioneering countries, it is an impressive 78.3%. New mechanisms such as the ‘Policy Conformity Flag’ support this development, which motivates companies to keep their data current. Japan leads the statistics with a renewal rate of 91.1%, followed by Finland and Germany.
Why the LEI is becoming indispensable
The Legal Entity Identifier offers regulatory benefits and business value. Organisations in India and other countries use the LEI to simplify business relationships, make international payments more secure, and increase transparency in the financial sector.
The growing acceptance in Thailand and the United Arab Emirates shows that the LEI has long been a global standard used across industries and countries.
Conclusion: A look into the future of the LEI
With over 2.57 million LEI numbers issued worldwide, the Legal Entity Identifier clearly plays a central role in the modern business world. In Asia-Pacific and India, in particular, there are clear opportunities for growth that take into account not only regulatory but also business requirements.
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