Sebi Amends Non-Convertible Securities Issue Rules To Incentivise Senior Citizens Investing In Debt Instruments

Securities and Exchange Board of India (Sebi) has amended rules relating to issuing and listing of non-convertible securities. The market regulator seeks to provide discounts to certain classes of investors in debt securities. The changes in the rules allow issuers of debt securities to offer incentives to investors such as senior citizens, women, and retail individual investors.

Such discounts on investments can also be provided by the debt issuers to serving or retired defence personnel, and to the widows and widowers of defence personnel, Sebi added. Such incentives could be provided by offering additional interest or discounts to these classes of investors subscribing to debt securities.

“Provided that nothing contained in this regulation shall preclude the issuer from offering an incentive in the  form  of  additional  interest  or  a  discount  to  the  issue  price  to  senior  citizens,  women,  serving  and retired defence personnel, widows and widowers of defence personnel, retail individual investors or any other category of investors as may be specified by the Board from time to time,” Sebi said.

For this purpose, Sebi also explained who can be considered as a retail individual investor in debt securities. Accordingly, retail individual investors are those who apply or bid for not more than Rs. 2 lakh worth of debt instruments.

Additionally, Sebi also said that such discounts or incentives will only be available to such investors who are allotted the securities at the time of issuance of the instruments. Debt issuers do not have to provide such incentives to such investor classes if they buy these securities after the initial allotment.

Provided further that such incentive shall be available only to the initial allottee but not in case the debt securities are transferred/ transmitted post allotment,” Sebi said.

The amendment follows a consultation paper floated by the market regulator proposing the changes in October, 2025. Through these changes, Sebi aims to encourage more retail investors to subscribe to debt securities. The move is expected to increase competitiveness in the debt market and strengthen the retail investor base. Earlier in 2025, Sebi Chairman, Tuhin Kanta Pandey had also called for the need for deepening India’s bond markets and bringing more retail investors into the fold.