SEBI has proposed reducing the minimal funding for particular person traders in social affect funds to Rs 1,000 from Rs 2 lakh to increase retail participation and ease fundraising for not-for-profit organisations on the Social Inventory Change.
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HEMANSHI KAMANI
SEBI on Monday proposed a pointy discount within the minimal funding required from particular person traders in social affect funds to Rs 1,000 from the present Rs 2 lakh, in a transfer geared toward widening retail participation and easing fundraising for not-for-profit organisations (NPOs) on the Social Inventory Change (SSE).
In its session paper, Sebi additionally proposed extending the registration interval for NPOs on the SSE with out fundraising and reducing the minimal subscription requirement for issuing Zero Coupon Zero Principal Devices (ZCZP).
The regulator stated the measures are supposed to “additional strengthen the SSE framework, facilitate ease of fund elevating and encourage higher participation by NPOs”.
Beneath the present Various Funding Fund (AIF) Laws, particular person traders are required to speculate a minimal of Rs 2 lakh in a social affect fund that invests completely in securities of NPOs listed or registered on the SSE.
SEBI has now proposed reducing this threshold to Rs 1,000 to align it with the present minimal utility dimension for Zero Coupon Zero Principal Devices (ZCZP) below the ICDR norms, thereby enabling wider retail participation in social affect investments.
On the registration entrance, Sebi has steered extending the interval throughout which NPOs can stay registered on the SSE with out elevating funds from the present two years to 3 years.
The proposal has taken under consideration sensible challenges confronted by NPOs, together with delays in statutory and regulatory approvals, and could be topic to approval by the SSE.
As well as, the regulator has proposed decreasing the minimal subscription requirement for ZCZP issuances from 75 per cent to 50 per cent in choose instances.
This rest would apply solely to tasks the place prices and outcomes might be carried out on a clearly identifiable per-unit foundation, guaranteeing that partial subscription doesn’t adversely have an effect on mission execution, Sebi stated.
In such instances, SSEs could be required to hold out due diligence to make sure that funds raised on the decrease subscription threshold can nonetheless be meaningfully deployed in direction of the said goals.
Additionally, the regulator stated that funds could be refunded to traders if the minimal subscription requirement isn’t met.
Printed on February 9, 2026
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