The Securities and Exchange Board of India officially released the Securities and Exchange Board of India (Portfolio Managers) Regulations, 2026, through a notification dated October 7, 2026. These regulations establish an updated framework that will become fully operative on April 1, 2027, superseding the previous regulatory structure for portfolio management services.

Rewriting the Rulebook and Core Metrics

Approved during SEBI’s 215th Board Meeting on September 24, 2026, the overhaul aims to simplify the industry by reducing the regulation length by 53 percent and cutting the word count by roughly 42 percent. The framework introduces specific financial parameters and operational figures to govern market participants.

Key figures outlined in the 2026 framework include the following metrics:

• ₹5 crore minimum net worth for regular portfolio managers, with at least 10 percent maintained in unencumbered liquid assets.
• ₹50 lakh minimum investment requirement per client for regular portfolio management services.
• ₹25 lakh minimum ticket size for the newly created Portfolio Management Service Route for Investment in Mutual Fund units.
• ₹2 crore minimum net worth for entities offering the specialized mutual fund route exclusively.
• 1 percent cap on management fees for the specialized mutual fund route based on assets under management.

The regulatory updates also alter operational limits by allowing portfolio managers to invest client funds in exchange-traded derivatives up to 1.25 times the client assets under management. Discretionary portfolios may allocate up to 10 percent of assets under management into investment-grade, unlisted debt with client consent.

Registration and Compliance Standards

Entities must apply to SEBI using a specified form and pay a non-refundable application fee. The First Schedule of the regulations specifies a ₹1 lakh application fee, a ₹10 lakh registration fee, and a ₹5 lakh renewal fee payable every three years.

The updated framework also introduces administrative changes to ease burdens on smaller operators. Dealing-room requirements are removed for portfolio managers with assets under management below ₹100 crore, and the educational bar for the Principal Officer has been relaxed to allow graduates to serve in this role.

By updating these standards, SEBI aims to enhance transparency, accountability, and professional conduct within the portfolio management industry to foster investor confidence.