SEBI proposes ₹5 crore asset test for accredited investors: Who could qualify?

SEBI has proposed adding a securities-market asset test to the eligibility criteria for Accredited Investors (AIs), potentially widening the pool of investors who can qualify for the status. The regulator has issued a consultation paper seeking public comments on a comprehensive review of the existing Accredited Investor framework.

What is SEBI proposing?

Under the proposal, securities market assets of ₹5 crore for individuals and ₹20 crore for body corporates would be introduced as an additional eligibility criterion for accreditation, alongside the existing income- and net-worth-based criteria.

The proposed asset-based route could significantly broaden the universe of investors eligible for accreditation. SEBI estimates that the pool of eligible Accredited Investors could increase to around 4 lakh, compared with an existing AIF investor base of approximately 1 lakh.

This means investors who may not qualify under existing income or net-worth criteria could potentially become eligible through the proposed securities-market asset criterion, subject to the final framework.

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What could change for investors?

The proposed framework could make Accredited Investor status accessible to a broader set of investors based on their market holdings, rather than relying only on income or net worth. If implemented, the changes could also simplify accreditation for eligible investors and make participation in alternative investment products more accessible across different investor categories

Manager-led accreditation proposed

SEBI has also proposed changes aimed at simplifying the accreditation process. One proposal is to introduce manager-led accreditation, alongside the existing Accreditation Agency route.

Under this mechanism, accreditation would be valid at the group level, potentially reducing the need for investors associated with the same group to undergo separate accreditation processes. The regulator has also proposed streamlining the validity of accreditation to three years, based on the latest documents.

NRIs, OCIs could get easier AIF access

Another significant proposal concerns investors living outside India. SEBI wants to expand the scope of deemed Accredited Investors to cover all Persons Resident Outside India (PROI) as defined under the Foreign Exchange Management Act, 1999.

The proposal would cover NRIs, OCIs and other persons resident outside India, allowing them to invest in Alternative Investment Funds (AIFs) more seamlessly without a minimum threshold.

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Benefits extend beyond AIFs

Accreditation has become increasingly significant across India's alternative investment ecosystem. According to SEBI, its benefits now extend beyond AIFs to Specialised Investment Funds (SIFs) of mutual funds, Portfolio Management Services (PMS) and Angel Funds.

SEBI has invited public comments on the consultation paper, with the last date for submissions set as September 3, 2026. The proposals are part of a consultation process and do not constitute final regulatory changes at this stage.

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