Sebi proposes new channel partner network to boost retail bond access
The Securities and Exchange Board of India (Sebi) is set to launch fixed income channel partners to broaden access to the retail bond market. This initiative is particularly focused on increasing engagement in smaller cities across India. Eligible individuals and firms can qualify as partners by fulfilling specific certification standards. Notably, existing mutual fund distributors can apply…
Mumbai: The Securities and Exchange Board of India (Sebi) has proposed creating a network of fixed income channel partners (FICPs) to boost retail access to corporate bonds and other fixed income securities, particularly in smaller cities like Tier-2 and Tier-3 locations. The proposal aims to expand retail participation in the Indian corporate bond market, which has grown substantially in recent years.
As of July 31, 2026, outstanding corporate bonds totaled over ₹60 lakh crore, compared to about ₹17.5 lakh crore at the end of FY15.
Sebi's proposal would allow individuals and entities registered with stock exchanges to become FICPs, working with online bond platform providers (OBPPs) to distribute fixed income securities. To become an FICP, an applicant must be an Indian citizen aged 18 or older, have completed Class 12, and hold a valid NISM certification in fixed income securities.
Partnership firms and corporations can also apply for FICP status, subject to eligibility conditions. AMFI-registered mutual fund distributors would be eligible to apply for FICP status without an enlistment fee, provided they obtain the necessary NISM certification.
The FICPs would assist investors with onboarding, documentation, KYC (Know Your Customer), and facilitating transactions, but would not be permitted to handle client funds or securities. Client orders would need to be routed directly through the OBPP platform. The framework is intended to replicate the success of the mutual fund distributor (MFD) model, which helped mutual funds reach smaller towns and cities, significantly contributing to the growth of retail folios in those areas.
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