SEBI To Consider Easing FPI Settlement Norms With Netting Proposal
SEBI is considering allowing netting of same-day trades for FPIs to improve efficiency and reduce costs.Summary
The Securities and Exchange Board of India (SEBI) is expected to ease settlement norms for foreign portfolio investors (FPIs) by permitting netting in same-day trades. Currently, FPIs settle equity trades on a gross basis, requiring independent funding for each purchase even with corresponding sales on the same day. The proposed framework would allow a net settlement, offsetting purchases and sales to determine the payable amount. This change aims to improve operational efficiency, reduce funding costs, and minimize foreign exchange costs. The move addresses concerns that the existing gross settlement system increases funding requirements and transaction costs for foreign investors, aligning Indian practices with global standards.
During its board meeting on March 24, 2026, SEBI will also review changes to governance norms for market intermediaries, including revising the “fit and proper person” criteria by considering only final orders regarding winding-up proceedings. The regulator is also considering formalizing provisions related to the right to a hearing to improve procedural clarity.
Additionally, proposals to ease business for Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) will be examined, along with a report on conflict of interest and transparency. This will be the fifth board meeting chaired by SEBI Chairman Tuhin Kanta Pandey.
(Source：5paisa)