Sebi allows online bond platforms to offer GIFT-IFSC-regulated bonds

Sebi has allowed online bond platforms to offer GIFT-IFSC-regulated securities, expanding their product range while mandating clear overseas labelling and regulatory compliance

The Securities and Exchange Board of India (Sebi) on Friday allowed online bond platform providers (OBPPs) to offer products and securities regulated by the International Financial Services Centres Authority (IFSCA), the unified regulator in GIFT-IFSC.

 

The move is part of modifications to the regulatory framework for OBPPs aimed at promoting ease of doing business. Sebi has also allowed such platforms to offer bonds issued under Section 54EC of the Income-tax Act, 1961, or Section 85 of the Income-tax Act, 2025.

 

Under the revised framework, OBPPs can offer products or securities regulated by financial sector regulators, including Sebi, the Reserve Bank of India (RBI), the Insurance Regulatory and Development Authority of India (IRDAI), IFSCA and the Pension Fund Regulatory and Development Authority (PFRDA).

 

 

IFSCA-regulated products, securities or services will have to be offered in the manner specified for Sebi-registered stock brokers operating within GIFT-IFSC and in compliance with applicable guidelines under the Foreign Exchange Management Act (FEMA), 1999, including Overseas Investment Rules and limits under the Liberalised Remittance Scheme (LRS).

 

Such products will also have to be clearly labelled as international or overseas instruments to prevent confusion with domestic debt securities.

 

The revised provisions allow products regulated by financial sector regulators to be offered either under a separate tab on an OBPP's online bond platform or on another website or platform. They will be governed by the directions and stipulations of the respective regulator, while OBPPs will have to specify the grievance redressal mechanism on their platform.