SEBI Expands Accredited Investor Limit to 4 Lakhs
By Market Desk
SEBI proposes to increase the Accredited Investor pool to 4 lakhs by including securities market assets, a significant expansion from the current 1 lakh.
The Securities and Exchange Board of India (SEBI) has put forth new proposals to significantly expand its Accredited Investor framework. This initiative aims to include securities market assets as an additional eligibility criterion, potentially increasing the number of eligible accredited investors to approximately 4 lakhs.
This represents a substantial rise from the current 1 lakh accredited investors. The review of the existing framework stems from suggestions by stakeholders and recommendations from SEBI’s Alternative Investment Policy Advisory Committee.
Key Proposed Figures
- Current Accredited Investors: 1 lakh
- Expected Accredited Investors: Approximately 4 lakhs
- Individual Securities Market Assets for Eligibility: At least Rs 5 crore
- Body Corporate Assets for Eligibility: At least Rs 20 crore
- Proposed Accreditation Validity: Three years
Widening the Investor Pool
Under the proposed rules, individuals with at least Rs 5 crore in securities market assets would become eligible for accreditation. Body corporates would also qualify with at least Rs 20 crore in assets, broadening the scope beyond existing income and net-worth based criteria.
Accredited Investors receive enhanced flexibility to engage with various investment products. This access includes several specialized avenues within the financial markets.
- Alternative Investment Funds (AIFs)
- Specialised Investment Funds (SIFs) of mutual funds
- Portfolio Management Services (PMS)
- Angel Funds
Streamlining Accreditation Processes
SEBI also aims to simplify the accreditation process significantly. The new framework introduces manager-led accreditation, which will be valid at a group level, offering an alternative to the current Accreditation Agency route.
Furthermore, the validity period for accreditation is proposed to be standardized to three years. This will be based on the latest documents submitted by the investor, ensuring a consistent and updated assessment.
Including Persons Resident Outside India
A key proposal involves expanding the category of deemed Accredited Investors to encompass all Persons Resident Outside India (PROI). This definition aligns with the Foreign Exchange Management Act, 1999.
This change would allow several groups to invest in AIFs more seamlessly without a minimum threshold.
- Non-Resident Indians (NRIs)
- Overseas Citizens of India (OCIs)
- Other non-resident individuals
These proposals are currently in a consultation phase. SEBI has invited public comments on the consultation paper, with the deadline set for September 3, 2026, before finalizing the new rules.