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Capital markets regulator SEBI introduced stricter regulations for the Social Stock Exchange (SSE) on September 19, 2025, aiming to enhance governance and transparency for not-for-profit organizations (NPOs) and social enterprises, according to a circular (SEBI/HO/CFD/CFD-PoD-1/P/CIR/2025/129).

The updated framework mandates that NPOs registering with the SSE must be Indian trusts, societies, or Section 8 companies with a valid registration certificate held for at least 12 months. New annual disclosure requirements cover governance, finances, donor lists, and social impact, due by October 31 or the income tax return deadline, whichever is later.

Social enterprises raising funds via the SSE must file an Annual Impact Report (AIR), verified by SEBI-registered Social Impact Assessors, covering at least 67% of program expenditure. SSEs can also enforce additional disclosure parameters to ensure compliance.

The reforms aim to protect investors, ensure accountability, and align SSE operations with SEBI’s broader capital market regulations, such as the ICDR and LODR frameworks. By mandating independent impact assessments, SEBI seeks to drive measurable social outcomes and foster confidence in India’s growing social finance sector.

“These changes strengthen the SSE ecosystem, ensuring funds serve genuine social purposes while maintaining regulatory oversight,” a SEBI spokesperson said.

The rules reflect SEBI’s push to mainstream social investment while mitigating risks of fraud and enhancing credibility in the evolving social sector.

Notable examples include Bengaluru-based SGBS Unnati Foundation, Transform Rural India, Swami Vivekananda Youth Movement and three other organisations.

India’s Social Stock Exchange (SSE) is gaining momentum as a platform for social enterprises and non-profit organizations (NPOs) to raise funds, attracting a growing pool of investors seeking both financial returns and social impact.

Launched to promote inclusive growth and financial inclusion, the SSE has seen several successful listings and fund raisings.

Notable examples include Bengaluru-based SGBS Unnati Foundation, which raised Rs 1.8 crore to train and employ government college graduates, and Transform Rural India, securing Rs 2 crore for skill development projects.

“The SSE provides a structured way for investors to support social causes they care about,” market analyst Mahesh Kumar said. “It’s not just philanthropy; for-profit social enterprises offer potential financial returns, similar to impact investing.”

Swami Vivekananda Youth Movement and three other organizations have collectively raised Rs 8 crore, focusing on education, health, and sustainable livelihoods.

The SSE’s rigorous listing standards, requiring regular audited reports and independent verification of social impact claims, are attracting investors. “Transparency and accountability are key,” noted Megha Shah, an impact investor. “I can track the tangible outcomes of my investments.”

Tax benefits recommended by the SSE committee are expected to further boost investor interest, although specific rules are yet to be defined.

While the SSE doesn’t explicitly list top-performing stocks, its growing roster of organizations spans various sectors, reflecting India’s diverse social welfare needs.