Archive · 16 Jan 2026
Sebi Proposes Fund Netting for FPIs
Sebi, the stock market regulator in India, has proposed a new rule to help foreign investors.
Currently, these investors have to pay for every share they buy and deliver every share they sell, even if they do both on the same day.
This can be expensive and cause problems with money availability.
Sebi wants to change this so that investors can use the money from selling shares to pay for buying shares on the same day.
This will make things easier and cheaper.
However, there are some rules to prevent too much risk.
Sebi is asking for feedback before making the final decision.
They are also making other changes to make it easier for investors to open accounts and provide documents.
Sebi proposes allowing FPIs to offset purchase and sale obligations within a trading day.
Current system requires gross settlement, leading to unnecessary liquidity strain and costs.
Proposed netting will free up capital, especially on heavy trading days.
Netting will be permitted only for 'outright' transactions, not for same stock trades.
Implementation requires regulatory changes by Sebi and the RBI.
- Who
- Securities and Exchange Board of India (Sebi)
- What
- Proposed changes to allow fund netting for foreign portfolio investors (FPIs)
- When
- Consultation paper released on Friday
- Where
- India
- Why
- To reduce funding costs and improve efficiency in the cash market
- Proposed Change
- Allow FPIs to offset purchase and sale obligations within a trading day
- Current System
- Requires settlements on a gross basis
- Impact
- Reduces funding costs and improves efficiency in the cash market
- Restrictions
- Netting permitted only for 'outright' transactions, not for same stock trades
- Implementation
- Requires regulatory changes by Sebi and the RBI
- Additional Measures
- Sebi has introduced digital signatures, Swagat-FI system, and streamlined registration for FPIs