SEBI Proposes Easier Access to Higher-Risk Investment Products
The Securities and Exchange Board of India (SEBI) has proposed changes that would make it easier for investors to qualify as accredited investors, the status that opens the door to higher-risk products such as alternative investment funds (AIFs) with lower ticket sizes, angel funds, co-investment vehicles and large value funds. The proposals are in SEBI's Consultation Paper on review of Accredited Investor framework dated 13 August 2026. Comments were invited till 3 September 2026. The proposals are not yet law, and current rules continue to apply until SEBI amends the SEBI (Alternative Investment Funds) Regulations, 2012.
Why accreditation matters
SEBI introduced the accredited investor framework in 2021 through amendments to the AIF Regulations. The status is meant to identify investors with the financial capacity and understanding to take on complex products. According to the consultation paper, an accredited investor currently gets these relaxations:
| Product | Normal minimum | For accredited investors |
|---|---|---|
| AIF | Rs 1 crore commitment | No minimum |
| Portfolio management services | Rs 50 lakh | No minimum |
| Specialised investment fund | Rs 10 lakh | No minimum |
| Angel funds, co-investment vehicles, large value funds | Open only to accredited investors | |
The number of accredited investors rose from 649 in July 2025 to 3,820 on 31 July 2026. Accredited investors held about Rs 1.91 lakh crore of AIF units on 31 December 2025, close to 30% of total AIF investments.
Present eligibility for individuals and entities
- Individuals, HUFs, family trusts and sole proprietors: annual income of at least Rs 2 crore; or 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 plus net worth of at least Rs 5 crore, of which at least Rs 2.5 crore is in financial assets.
- Bodies corporate and other trusts: net worth of at least Rs 50 crore.
- Partnership firms: each partner must independently qualify.
What SEBI has proposed
Securities market assets as a new test
Investors could qualify on the value of their securities market holdings, which can be verified digitally through depositories and brokers. The proposed thresholds are Rs 5 crore for individuals and Rs 20 crore for bodies corporate and non-family trusts. Demat securities, mutual fund folios, futures open positions, unlisted demat securities and overseas securities would count. SEBI estimates that about 3.7 lakh investors met the Rs 5 crore individual threshold on 30 April 2026. Because holdings are gross values that do not reflect liabilities, the thresholds carry a margin over the net worth tests.
Manager-led accreditation
Today an investor obtains a certificate from an accreditation agency, which is a subsidiary of a stock exchange or depository, and then approaches the fund manager. SEBI proposes that investment managers may themselves determine accreditation during onboarding. Status determined by a manager would be valid for three years across the AIFs, SIFs and PMS of the same group. Proposed documents include the latest income-tax return for income, a CA certificate not older than six months for net worth, and an eCAS or broker statement or CA certificate not older than six months for securities holdings. Managers would need a written accreditation policy, records and an annual independent auditor certification. The agency route would continue for investors who want a certificate usable with unrelated managers, and SEBI has proposed aligning its validity with the three-year manager route.
Foreign investors deemed accredited
Deemed accreditation is now limited to categories such as governments, QIBs, Category I FPIs, sovereign wealth funds and multilateral agencies. SEBI proposes extending it to all persons resident outside India as defined under the Foreign Exchange Management Act, 1999.
Open questions
SEBI has also sought views on industry suggestions that limited liability partnerships qualify when every partner qualifies, and that wholly owned subsidiaries qualify on the parent's net worth. It has flagged concerns on both because the entities are separate legal persons.
What professionals should note
CAs are likely to see more requests for net worth certificates if the manager-led route is adopted, and the six-month freshness requirement will matter. Easier accreditation does not make these products less risky; investors should still judge suitability, liquidity and lock-in before investing.
Updated on 28 September 2026: identified the SEBI consultation paper of 13 August 2026 and added its proposals, current eligibility tests, product relaxations, statistics and the 3 September 2026 comment deadline.
