SEBI proposes amendments to securitised debt norms to align with RBI framework

SEBI Proposes Changes to Securitised Debt Rules

The Securities and Exchange Board of India has floated a consultation paper seeking amendments to the SEBI (Issue and Listing of Securitised Debt Instruments and Security Receipts) Regulations, 2008. The exercise is aimed at bringing the capital markets regulator’s securitisation framework closer to the Reserve Bank of India’s Master Direction on Securitisation of Standard Assets, issued in September 2021. Stakeholders have been invited to submit comments until May 25, 2026.

The proposal follows earlier amendments approved by SEBI’s board in December 2024 and notified in May 2025. Market feedback after that update pointed to inconsistencies between SEBI’s regulations and the RBI’s directions, especially for securitisation deals originated by entities regulated by the central bank. The Corporate Bonds and Securitisation Advisory Committee reviewed these gaps and recommended further changes.

What The Proposals Cover

One key proposal is to exempt RBI-regulated entities from the existing rule that no single obligor may account for more than 25% of an asset pool. That cap is meant to curb concentration risk, but SEBI noted it effectively blocks the listing of securitised debt instruments backed by a single asset, even though the RBI framework permits such structures. The relaxation is expected to aid the listed securitisation market, since RBI-regulated originators already face prudential supervision.

SEBI has also proposed periodic disclosure norms and a clearer definition of servicers’ obligations, to improve transparency and investor protection. Changes to how the board of trustees of Special Purpose Distinct Entities is constituted are proposed to strengthen governance and oversight. Separately, the regulator has suggested removing the bar on originators and SPDEs from the same group entering into securitisation transactions, aligning with RBI norms while keeping transactions within a regulated framework. Provision…