The Securities and Exchange Board of India (“SEBI”), vide circular no. HO/19/34/11(9)2025-AFD-POD1/I/2286/2026 dated January 09, 2026, has further simplified the requirements for grant of accreditation to investors under the Accredited Investor framework applicable to Alternative Investment Funds (“AIFs”). The circular has been issued under the SEBI (Alternative Investment Funds) Regulations, 2012 (“AIF Regulations”) and comes into force with immediate effect.
Regulatory Framework
The Accredited Investor framework was introduced pursuant to amendments to the AIF Regulations notified on August 03, 2021, with detailed modalities prescribed through SEBI circular dated August 26, 2021, now subsumed in Chapter 12 of the SEBI Master Circular for AIFs dated May 07, 2024. Subsequently, SEBI issued further simplifications vide circular dated December 18, 2023. The present circular builds upon the existing framework to address operational challenges and ease procedural requirements for AIF managers and investors.
Key Relaxations Introduced
SEBI has permitted AIF managers, pending receipt of the accreditation certificate, to finalise and execute contribution agreements and initiate related operational procedures based on the investment manager’s assessment of investor eligibility. However, SEBI has clarified that any commitment made by such investor shall not be included in the scheme corpus until the accreditation certificate is obtained, and no funds shall be accepted from such investor prior to issuance of the accreditation certificate. These safeguards ensure continued compliance with prudential norms linked to corpus thresholds.
Simplification of Net-Worth Documentation
In respect of accreditation based on net-worth criteria, SEBI has dispensed with the requirement of submitting a detailed break-up of net worth as an annexure to the net-worth certificate. Further, it has been clarified that it is optional for the chartered accountant to specify the actual net-worth amount, provided the certificate confirms that the applicant meets the prescribed eligibility threshold.
Documentation Requirements
The circular provides a revised list of documents to be submitted by applicants seeking accreditation, including proof of identity and address, incorporation or trust documents (as applicable), financial information such as income tax returns, audited financial statements or net-worth certificates, and an undertaking regarding correctness of information furnished. Accreditation agencies may seek additional documents where necessary to verify the genuineness of the information provided.
Compliance Test Report Requirement
SEBI has directed that the trustee, sponsor or manager of the AIF, as applicable, shall ensure that the Compliance Test Report prepared under Chapter 15 of the SEBI Master Circular for AIFs dated May 07, 2024, specifically includes compliance with this circular.
Practical Considerations for AIF Managers
AIF Managers should review and update investor onboarding processes to reflect the relaxations introduced by this circular, while ensuring that no capital is accepted and no corpus computation is impacted prior to issuance of accreditation certificates. Managers should also ensure robust internal controls and appropriate disclosures in the Compliance Test Report. Overall, the circular is expected to facilitate smoother investor onboarding and capital mobilisation without diluting regulatory safeguards.
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