SEBI Plans Alternative Capital Raising Platform To Help Start-Ups

30 March,Mumbai

With an aim to help start-ups andyoung entrepreneurs in raising funds, SEBI Monday proposed an’Alternate Capital Raising Platform’, wherein such firms canraise money from institutions and HNIs from the capitalmarkets under a relaxed regulatory regime.

However, retail investors would be restricted frominvesting in such companies, given the risks involvedtherein, Security and Exchange Board of India said, whileadding that the adequate disclosures would be required to bemade without hampering the capital-raising potential of suchfirms in new-age sectors like technology.

The move is aimed at helping such companies raise fundsfrom within India and stop their flight to overseas markets.

The market watchdog has sought public comments on theproposal by April 20 this year. Under the proposed alternate capital raising platform,money should be raised only from institutions and high networth individuals by the new-age companies having innovativebusiness model and belonging to knowledge-based technologysector.