SEBI proposes Rs 5 crore asset route for accredited investors

Markets regulator Securities and Exchange Board of India (SEBI) on Thursday, August 13, proposed a new criterion for accredited investor status, under which individuals holding at least Rs 5 crore in securities-market assets could qualify regardless of existing income or net-worth thresholds, in a move aimed at widening the investor pool.

For body corporates and trusts other than family trusts, the SEBI proposed a threshold of Rs 20 crore in securities-market assets.

The regulator said the changes were intended to expand the pool of investors eligible for accredited status and encourage greater participation in alternative investment funds (AIFs), according to its consultation paper.

Sebi's analysis found that around 3.7 lakh investors could qualify under the proposed securities-market-assets criterion as of April 30, 2026 nearly four times the current AIF investor base of about 96,000, pointing to significant potential growth in eligible investors.

The regulator said the threshold was designed to ensure eligible investors have adequate financial capacity and a demonstrated willingness to take risk, based on an analysis of securities holdings and the share of option traders among them.

Individuals, Hindu Undivided Families, family trusts and sole proprietorships currently qualify as accredited investors by meeting any of several income or net-worth benchmarks: annual income of at least Rs 2 crore; net worth of at least Rs 7.5 crore with at least Rs 3.75 crore in financial assets; or annual income of at least Rs 1 crore combined with net worth of at least Rs 5 crore, including at least Rs 2.5 crore in financial assets.

Under the new proposal, qualifying securities-market assets would include equity and debt instruments, REITs and InvITs, AIF units, and other dematerialised securities, as well as mutual fund folio holdings, futures open-interest positions, unlisted dematerialised securities and overseas securities-market investments.

Sebi also proposed letting investment managers determine and record an investor's accredited status during onboarding, with such accreditation recognized at the group-entity level across AIFs, specialised investment funds and portfolio management services.

For verification, investors would need to submit their latest income-tax return for income-based eligibility, while net worth could be established through a chartered accountant's certificate no older than six months. Securities-market assets could be verified via an eCAS summary statement from depositories, a broker statement no older than six months, or a chartered accountant's certificate.

Sebi further proposed treating all Persons Resident Outside India, including foreign portfolio investors, as deemed accredited investors under the framework.

The proposals are part of Sebi's broader review of the accredited investor framework, and public comments have been invited until September 3.