The Securities and Exchange Board of India (SEBI) has eased the process for granting accredited investor status under the Alternative Investment Fund (AIF) regulations to reduce operational hurdles and make onboarding smoother for both investors and fund managers.

Key Highlights

• SEBI simplified accreditation norms to ease onboarding and reduce documentation hurdles for AIF investors.
• AIF managers can complete agreements before certification, but funds count only after accreditation approval.

Under the revised framework, AIF investment managers can now finalise and sign contribution agreements and begin related formalities based on their own assessment of an investor’s eligibility, even if the investor has not yet received the official accreditation certificate from a recognised agency. However, any investor commitments will not count towards the fund’s corpus, and funds can be accepted, only once the accreditation certificate is formally issued.

SEBI has also relaxed documentation requirements for accreditation based on net-worth criteria — removing the previous need to submit a detailed net-worth break-up. Now, a chartered accountant’s certificate confirming that the investor meets the prescribed eligibility threshold is sufficient.

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These changes, which take effect immediately, are designed to speed up the investment process and reduce paperwork, while maintaining key prudential safeguards linked to fund corpus and investor protection. SEBI has also tasked AIF trustees, sponsors, and managers with ensuring compliance with the updated provisions in their routine Compliance Test Reports.

Overall, the regulatory tweaks are aimed at fostering greater ease of doing business in India’s alternative investment ecosystem.