The Securities and Exchange Board of India (SEBI) has introduced changes to regulations governing Foreign Portfolio Investors (FPIs) and Foreign Venture Capital Investors (FVCIs), replacing the existing US dollar-based fee structure with payments denominated in Indian rupees.
The revised framework will come into effect after six months, allowing foreign investors and intermediaries sufficient time to transition to the new system.
Under the updated regulations, the existing registration fee of $1,000 for FPIs and FVCIs will be replaced with a charge of ₹90,000 or its equivalent in eligible foreign exchange.
SEBI has also revised other charges, including the registration fee for Category-I FPIs and FVCIs, which has been increased from $2,500 to ₹2.3 lakh.
The regulator has also modified late fees and continuation charges. Designated depository participants (DDPs), which facilitate FPI operations in India, will now be required to transfer these fees to SEBI within five working days of granting registration.
To simplify compliance procedures, SEBI has further updated the common application form for FPI registration by adding fields for date of birth or incorporation.
The move will support PAN application procedures following changes introduced by the Central Board of Direct Taxes (CBDT).
The changes are aimed at improving efficiency in fee collection and accounting processes.
Previously, payments received in US dollars required manual accounting and invoicing, resulting in delays and limited real-time visibility in financial reporting.
SEBI collected around $12.98 million during financial year 2025-26 from registration, continuation and other fees paid by FPIs and FVCIs, including GST.
Separately, SEBI has also revised payment rules for custodians. Instead of an annual payment of ₹10 lakh, custodians will now pay fees on a monthly basis at ₹85,000 per month.
In another regulatory change, SEBI amended Mutual Fund Regulations to allow asset management companies (AMCs) to use intraday borrowing for managing short-term settlement mismatches.
Mutual funds can now borrow funds within a day to address differences arising from pay-in and pay-out settlement timings across asset classes, foreign exchange settlements and other transactions.
The new provision supplements existing borrowing rules that allow mutual funds to borrow up to 20% of a scheme’s net assets for meeting obligations such as investor redemptions.
AMCs will be responsible for repaying intraday borrowings by the end of the day and ensuring compliance with mutual fund regulations.
