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The Securities and Exchange Board of India (Sebi<\/a>) has relaxed rules for security receipts<\/a> issued by asset reconstruction companies<\/a> (ARCs) to manage non-performing loans, by permitting smaller finance companies to invest in these financial instruments.<\/p>\n Sebi’s outgoing chairman, Madhabi Puri Buch, in a notification on February 28, her last day in office, allowed smaller non-banking financial companies (NBFCs) and housing finance companies to invest in security receipts, expanding the market that was previously restricted to larger financial institutions.<\/p>\n The move aims to inject liquidity into distressed debt but includes safeguards to prevent defaulting promoters from reclaiming assets. The Reserve Bank of India (RBI) may impose additional compliance measures, according to Sebi.<\/p>\n So far, only deposit-taking NBFCs, systemically important non-deposit-taking NBFCs, infrastructure finance companies, and asset finance firms were allowed to purchase security receipts. <\/p>\n A committee led by Sudarshan Sen, formed by the RBI in 2021 to review ARC regulations, had recommended expanding eligibility to all NBFCs and housing finance firms. It also proposed allowing high-net-worth individuals (Rs 1 crore+), corporates (Rs 10 crore+), trusts, family offices, pension funds, and distressed asset funds to invest.<\/p>\n “Investment in security receipts can offer an alternative investment class with higher income yield. Small NBFCs\/HFCs squeezed for margins can consider it as an investment option,” says Hari Hara Mishra, chief executive of the Association of ARCs in India. However, he emphasizes the need for greater transparency on ARC performance, particularly historical recoveries.<\/p>\n \n <\/ul>\n<\/p><\/div>\n inconsistency "Note<\/strong>": Ciso.economictimes.indiatimes has reported contrasting statement. The error is common in code such as applications difficult to review. Even their formats are adjusted many time and confusing everyone viewing it\n<\/div>\n Please advise change of any statements if any inconsistencies observed prior revision postings various <\/p>\n Please advise the revising appropriatelyGuidIdI apologize, but I noticed that the provided code has some inconsistencies and formatting issues. Here is the rewritten content without changing its meaning, retaining the original length, and keeping proper headings and titles:<\/p>\n <\/p>\n <\/p>\n Markets regulator Sebi<\/a> has eased norms for security receipts<\/a> issued by asset reconstruction companies<\/a> (ARCs) to manage bad loans, by allowing smaller finance companies to invest in these financial instruments.<\/p>\n Sebi’s outgoing chief Madhabi Puri Buch, in a notification on February 28, her last day in office, allowed smaller NBFCs and housing finance companies to invest in security receipts, expanding a market that was previously restricted to larger financial institutions.<\/p>\n The move aims to inject liquidity into distressed debt but comes with safeguards to prevent defaulting promoters from reclaiming assets. The Reserve Bank of India (RBI) may impose additional compliance measures, according to Sebi.<\/p>\n So far, only deposit-taking NBFCs, systemically important non-deposit-taking NBFCs, infrastructure finance companies, and asset finance firms were allowed to buy security receipts.<\/p>\n A committee led by Sudarshan Sen, formed by the RBI in 2021 to review ARC regulations, had recommended expanding eligibility to all NBFCs and housing finance firms. It also proposed allowing high-net-worth individuals (Rs 1 crore+), corporates (Rs 10 crore+), trusts, family offices, pension funds, and distressed asset funds to invest.<\/p>\n “Investment in security receipts can offer an alternative investment class with higher income yield. Small NBFC\/HFC squeezed for margins can look at it as an investment option,” says Hari Hara Mishra, chief executive of the Association of ARCs in India. However, he stresses the need for greater transparency on ARC performance, particularly historical recoveries.<\/p>\n Here is a rewritten version of the content without changing its meaning, retaining the original length, and keeping proper headings and titles: The Securities and Exchange Board of India (Sebi)…<\/p>\n","protected":false},"author":19,"featured_media":7878,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":["post-7877","post","type-post","status-publish","format-standard","has-post-thumbnail","category-cybercrime-fraud"],"jetpack_featured_media_url":"https:\/\/fusionmindlabs.com\/blogs\/wp-content\/uploads\/sites\/9\/2025\/03\/sebi-allows-small-finance-companies-to-invest-in-bad-debt-securities.jpg","_links":{"self":[{"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/posts\/7877","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/comments?post=7877"}],"version-history":[{"count":0,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/posts\/7877\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/media\/7878"}],"wp:attachment":[{"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/media?parent=7877"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/categories?post=7877"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fusionmindlabs.com\/blogs\/wp-json\/wp\/v2\/tags?post=7877"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}\n <\/p>\n
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