SEBI Accredited Investor Framework 2026: What the September 24 Board Decision Changes for Angel Funds, AIFs and Non-Resident Investors
Quick Summary
- What happened: At its 215th meeting on 24 September 2026, the SEBI Board approved amendments to the Accredited Investor (AccI) framework (SEBI Press Release No. 59/2026, item 12).
- Four changes approved: manager-led accreditation by AIF managers, SIF AMCs and SEBI-registered portfolio managers; a new securities market exposure test (Rs 5 crore for individuals, HUFs, family trusts and sole proprietorships; Rs 20 crore for body corporates and other trusts); deemed accreditation for all persons resident outside India, including FPIs; and accreditation of LLPs where every partner is an AccI.
- Validity: per the release, accreditation under both the manager-led route and the Accreditation Agency route will be valid for three years.
- Status today: these are Board approvals. The SEBI (Alternative Investment Funds) Regulations, 2012 on SEBI’s website are shown as last amended on 14 July 2026, so the accredited investor definition in regulation 2(1)(ab) still reads as before.
- Why founders should care: under regulation 19D(1), an angel fund may raise money only from accredited investors, and angel funds registered on or before 10 September 2025 must meet that mandate by 31 March 2027.
The SEBI accredited investor framework 2026 review changes who can count as an “accredited investor” and who can certify it. On 24 September 2026 the SEBI Board approved four amendments aimed, in the words of the release, at “simplifying the process of accreditation, and expanding the pool of eligible investors”. For founders raising from angel funds, for fund managers, and for CAs who certify net worth and income for accreditation, the details matter. This post sets out what the Board approved, what the law says today, and what you can act on now.
What is an accredited investor under the SEBI AIF Regulations today?
Regulation 2(1)(ab) of the SEBI (Alternative Investment Funds) Regulations, 2012 defines an accredited investor as a person granted a certificate of accreditation by an accreditation agency who meets these tests:
| Investor type | Current eligibility test (regulation 2(1)(ab)) |
|---|---|
| Individual, HUF, family trust or sole proprietorship | (A) annual income of at least Rs 2 crore; or (B) net worth of at least Rs 7.5 crore, of which at least Rs 3.75 crore is in financial assets; or (C) annual income of at least Rs 1 crore and net worth of at least Rs 5 crore, of which at least Rs 2.5 crore is in financial assets |
| Body corporate | Net worth of at least Rs 50 crore |
| Trust other than a family trust | Net worth of at least Rs 50 crore |
| Partnership firm under the Indian Partnership Act, 1932 | Each partner independently meets the eligibility criteria |
The proviso deems certain investors to be accredited without a certificate: the Central and State Governments, their developmental agencies and funds, qualified institutional buyers under the ICDR Regulations, Category I foreign portfolio investors, sovereign wealth funds, multilateral agencies, and any other entity specified by SEBI. An “accreditation agency” is a subsidiary of a recognised stock exchange or of a depository, or any other entity SEBI specifies (regulation 2(1)(aa)).
What did the SEBI Board approve on 24 September 2026?
Item 12 of Press Release No. 59/2026 lists four decisions.
1. Manager-led accreditation
As “an additional and optional route”, managers of AIFs, AMCs offering Specialized Investment Funds (SIFs) and SEBI-registered portfolio managers will be permitted to accredit investors. The existing route through Accreditation Agencies will continue. The release adds that manager-led accreditation will be portable across AIF, SIF and PMS products within the same group, “subject to appropriate safeguards”.
2. Securities market exposure as a new eligibility test
Investors will be permitted to qualify on securities market exposure of at least Rs 5 crore for individuals, HUFs, family trusts and sole proprietorships, and Rs 20 crore for body corporates and other trusts. The release describes this as “a digitally verifiable additional eligibility criterion”. It is in addition to the income and net worth tests, not a replacement.
3. Deemed accreditation for all non-residents
Persons resident outside India, as defined under the Foreign Exchange Management Act, 1999, including Foreign Portfolio Investors, will be deemed to be accredited investors. Today only Category I FPIs sit in the deemed list.
4. Accreditation of LLPs
LLPs will be eligible for accreditation where each partner is an AccI, “in line with the existing framework for partnership firms”. The current definition covers partnership firms under the 1932 Act but does not name LLPs.
Current rule vs Board-approved change
| Point | Regulation 2(1)(ab) as it stands | Approved by SEBI Board, 24 Sep 2026 |
|---|---|---|
| Who accredits | Accreditation agency | Accreditation agency, or (optional) AIF manager, SIF AMC or SEBI-registered portfolio manager |
| Eligibility tests | Income and / or net worth (with financial-asset floor) | Same, plus securities market exposure of Rs 5 crore (individuals and similar) or Rs 20 crore (body corporates and other trusts) |
| Non-residents | Category I FPIs deemed accredited; others need a certificate | All persons resident outside India under FEMA, including FPIs, deemed accredited |
| LLPs | Not named | Eligible where each partner is an AccI |
| Validity | Not stated in the regulation | Three years under both routes |
Is the new accredited investor framework in force?
No. A Board approval is a policy decision. The accredited investor definition sits in regulation 2(1)(ab) of the AIF Regulations, and SEBI’s regulations page lists the AIF Regulations as last amended on 14 July 2026. Until SEBI notifies amending regulations (and any circular on the manner of accreditation), accreditation continues on the current tests through an accreditation agency. Do not onboard an investor on the Rs 5 crore securities exposure test, or treat a non-FPI non-resident as deemed accredited, on the strength of the press release alone.
Why this matters for angel funds and the founders they back
Regulation 19D(1) of the AIF Regulations says angel funds “shall raise funds only from accredited investors by way of issue of units”, with key management personnel of the fund or its manager allowed to invest. Regulation 19A(2) defines an “angel investor” as an accredited investor, or such key management personnel, who invests in an angel fund.
For angel funds registered with SEBI on or before 10 September 2025, SEBI’s circular HO/19/34/11(7)2025-AFD-POD1/I/20626/2026 dated 7 September 2026 moved the deadline to implement the accredited investor mandate to 31 March 2027. Until then such a fund may not offer investment opportunities to more than 200 non-accredited investors. We covered that circular in detail in our post on the 31 March 2027 extension, and the original framework in our September 8 deadline explainer.
The 31 March 2027 date is in force now. The Board-approved routes are not. An angel fund planning its investor base for that date should plan on the current tests in regulation 2(1)(ab) and move to the new routes only once they are notified.
Who is affected, and how
- Founders raising from angel funds: the investors on an angel fund’s cap table must be accredited. If your round depends on investors who are not yet accredited, the current tests still decide whether they can come in through the fund.
- Angel fund and AIF managers: the manager-led route, once notified, would let you accredit investors yourself as an optional alternative to an accreditation agency. Until then, keep using the agency route.
- NRI and foreign investors: today, unless they are Category I FPIs or another deemed category, they need a certificate of accreditation. The approved change would deem every person resident outside India accredited once notified.
- LLP investors: an LLP whose partners are all AccIs is not currently named in the definition; the approved change would add it.
- CAs: income and net worth certification for accreditation under the current tests continues unchanged.
What to do now
- Treat item 12 of PR No. 59/2026 as approved policy, not law. Keep onboarding investors under regulation 2(1)(ab) as it stands.
- If you run an angel fund registered on or before 10 September 2025, map each investor against the current tests and the 31 March 2027 deadline in the 7 September 2026 circular.
- Watch SEBI’s regulations and circulars pages for the notified amendment to the AIF Regulations, and read the notified text before relying on any of the four new routes.
Sources
- Source: SEBI, Press Release No. 59/2026, “Key decisions taken in the SEBI Board Meeting dated 24th September, 2026”, item 12, sebi.gov.in.
- Source: SEBI (Alternative Investment Funds) Regulations, 2012 [last amended on 14 July 2026], regulations 2(1)(aa), 2(1)(ab), 19A(2) and 19D(1), sebi.gov.in.
- Source: SEBI Circular HO/19/34/11(7)2025-AFD-POD1/I/20626/2026 dated 7 September 2026, “Relaxation in timeline with respect to Accredited Investor mandate for Angel Funds”, sebi.gov.in.
Talk to an expert
Raising from an angel fund, or setting one up, and unsure whether your investors qualify as accredited today? Tax Update India can help you work through the current tests and the angel fund deadline. Book a quick call.
Disclaimer: This article is for general information only and reflects the law as on the date of publication. It is not legal or tax advice. Please consult a qualified professional before acting on it.
You can reach out to the author on : [email protected]
www.asbanka.com
- RoDTEP Scheme Extended Till 31 December 2026: What DGFT Notification 41/2026-27 Means for Exporters - October 6, 2026
- SEBI Accredited Investor Framework 2026: What the September 24 Board Decision Changes for Angel Funds, AIFs and Non-Resident Investors - October 6, 2026
- FDI in Inventory-Based E-commerce for Exports: What Entry 15.2.5 of the NDI Rules (S.O. 4870(E), 2 September 2026) Now Allows - October 2, 2026