Predictive control is an emerging alternative in the control of power converters because of its potential for achieving fast transient response and increased control accuracy. Research on this topic has increased in recent years owing to the availability of high speed digital controllers that can be used for the control of power electronic systems. This study proposes a predictive current control scheme for an improved topology of distribution static compensator (DSTATCOM) intended for load compensation. The proposed strategy derives the converter switching pulses using a cost function that defines the desired system behaviour. An improved DSTATCOM topology employing predictive current control algorithm tracks reference current effectively and makes source current sinusoidal and also in-phase with voltage at the point of common coupling in both steady state and transient conditions. In addition, this scheme does not require any modulation technique. The control scheme has been implemented using field programmable gate array. Simulation and experimentation have been carried out to verify and validate the performance of the proposed scheme and the results are reported in this study.