On May 09, 2025, the Securities and Exchange Board of India (“SEBI”) issued a consultation paper proposing a regulatory change to allow Investment Advisers (“IAs”) and Research Analysts (“RAs”) to use units of liquid mutual funds, in addition to fixed deposits, to meet the deposit requirements under the SEBI (Investment Advisers) Regulations, 2013 and the SEBI (Research Analysts) Regulations, 2014 (“Consultation Paper”).[1]
This Consultation Paper seeks to provide greater flexibility in fulfilling the net worth or deposit requirements, thereby improving capital efficiency and enabling better liquidity management for IAs and RAs.
SEBI has invited public comments on the proposal latest by May 29, 2025. Stakeholders are encouraged to review the consultation paper and provide their feedback to help shape a more balanced and efficient compliance framework.
[1]https://www.sebi.gov.in/reports-and-statistics/reports/may-2025/consultation-paper-on-use-of-liquid-mutual-funds-for-compliance-with-deposit-requirement-by-investment-advisers-and-research-analysts_93881.html