SEBI has opened a second route to accredited-investor status — and fund managers, not only accreditation agencies, can now grant it. The change comes in the circular headed "Review of the framework for Accredited Investors" — SEBI Circular No. HO/19/34/11(6)2026-AFD-POD1/I/25244/2026, dated 5 November 2026, signed by Anshul Jagdish Goyal, Deputy General Manager, and in force with immediate effect. A Manager of an Alternative Investment Fund (AIF), the asset management company (AMC) of a Specialized Investment Fund (SIF), or a portfolio manager under the SEBI (Portfolio Managers) Regulations, 2026 may now determine and record an investor's accredited status at onboarding or during a scheme's tenure, after verifying eligibility under the SEBI (Alternative Investment Funds) Regulations, 2012 and this circular. Accreditation under either route is now valid for three years, and a new securities market exposure route lets an individual qualify with at least INR 5 crore of qualifying exposure, or a body corporate with at least INR 20 crore.
In plain business-owner language: a wealthy investor wanting access to AIFs, SIFs and portfolio management services no longer waits for a separate agency to certify them — the fund manager they invest with can check eligibility and record them as accredited itself, for three years. For managers, the trade-off is clear: the Manager granting the status must get the check right and keep the proof for at least five years.
Quick Answer: SEBI's circular "Review of the framework for Accredited Investors", dated 5 November 2026 and effective immediately, lets AIF, SIF and PMS Managers determine accredited-investor status themselves, valid for three years, with a new qualifying securities market exposure of INR 5 crore for individuals and INR 20 crore for bodies corporate, while Persons Resident Outside India are deemed accredited investors.
What changed
The circular follows the AIF (Third Amendment) Regulations, 2026, No. SEBI/LAD-NRO/GN/2026/326 dated 9 October 2026, Gazette 14 October 2026, notified 15 October 2026. It was issued under Section 11(1) of the SEBI Act, 1992 read with Regulations 2(1)(ab) and 36 of the AIF Regulations; the Master Circular for AIFs dated 3 June 2026 has been updated with these provisions. It is addressed to all AIFs, recognised Accreditation Agencies, Portfolio Managers, Investment Advisers, Research Analysts and Mutual Funds.
The biggest change is the manager-led route in paragraph 3. Until now, accreditation ran only through Accreditation Agencies. Now a "Manager" — an AIF manager, an SIF AMC, or a portfolio manager under the Portfolio Managers Regulations, 2026 — may determine and record accredited status at onboarding or during a scheme's tenure, after verifying eligibility. The Manager must record the status, confirm it in writing, and state the date and validity period.
Manager-led accreditation is an additional, optional route; the agency route continues. Where an investor furnishes a valid Agency certificate, the Manager must rely on it and not re-determine during its validity. A Manager's determination is recognised across Managers of the same Group for AIFs, SIFs and portfolio management services during validity ("Group" = "corporate group" under Explanation I to Regulation 19F(1) of the AIF Regulations), but must be determined afresh on onboarding by a Manager outside the Group. Investment Advisers and Research Analysts cannot determine status independently; they may rely on a valid determination by a Manager in their Group.
Key changes at a glance
- Manager-led accreditation: AIF Managers, SIF AMCs and portfolio managers may determine and record accredited status at onboarding or during a scheme's tenure.
- Three-year validity: three years from accreditation for both routes; earlier certificates keep unexpired validity.
- Group-wide recognition: recognised across same-Group Managers during validity; fresh determination outside the Group.
- Exposure route: INR 5 crore for an individual, HUF, family trust or sole proprietorship; INR 20 crore for a body corporate or a trust other than a family trust.
- Advisers and analysts cannot accredit: they may only rely on a valid determination by a Manager in their Group.
- LLPs recognised: an LLP qualifies where each partner independently satisfies the criteria applicable to that partner.
- PROIs deemed accredited: a Person Resident Outside India under FEMA, 1999 needs no certificate or Manager-led accreditation.
- Managers are accountable: five-year records, a written policy, periodic audit/compliance review.
Validity: three years, and what happens inside a scheme
Paragraph 4 fixes validity at three years from accreditation, for both routes — one clock, whichever was used. An investor accredited at onboarding stays reckoned as accredited for the remaining life of that scheme, even if the three years run out during it. Earlier certificates keep unexpired validity. But onboarding by a Manager outside the Group means a fresh determination.
The new securities market exposure route: ₹5 crore and ₹20 crore
Paragraph 5 adds an exposure route: at least INR 5 crore for an individual, HUF, family trust or sole proprietorship, and INR 20 crore for a body corporate or other trust. Qualifying exposure means demat securities; mutual fund folios; unlisted demat securities; overseas securities investments; and NPS investments — a closed list.
For demat securities, the eCAS value as of the statement date is used. For unlisted/overseas holdings not valued in eCAS, a practising CA certificate is required, identifying the nature of the securities, valuation date and value — no self-declared values.
Eligibility criteria and the documents that prove them
Paragraph 7 sets out the criteria and documents under Regulation 2(1)(ab) of the AIF Regulations — income, net worth or securities market exposure:
Freshness limits: net worth certificates and eCAS statements must each be under six months old; the alternative CA certificate must show the threshold was met within the last six months.
LLPs and Persons Resident Outside India
Paragraph 8 recognises an LLP under the Limited Liability Partnership Act, 2008 as an Accredited Investor where each partner independently satisfies the applicable criteria. A partner that is itself a body corporate (including another LLP), a firm or a trust must independently satisfy its own criteria — the LLP cannot qualify on one partner alone.
Paragraph 9 deems a Person Resident Outside India (PROI) under FEMA, 1999 an Accredited Investor: no certificate or Manager-led accreditation is needed. The Manager must record the basis of PROI identification, and deemed status does not dilute PMLA, 2002 obligations — client due diligence, beneficial-owner identification and source-of-funds verification still apply. See also: SEBI PROI KYC and digital onboarding for NRIs and OCIs abroad.
Safeguards: the Manager is accountable
Paragraph 6 sets out the safeguards. The Manager is accountable for compliance, and the decision, criterion and verification must be documented for independent review. Records and verification evidence must be kept for at least five years from accreditation, or until five years after the investor exits all schemes managed by the Manager, whichever is later, and made available for inspection.
Every Manager undertaking accreditation must adopt a policy covering conflict-of-interest controls (including separation of accreditation from business development/distribution), an escalation and grievance redressal process, and record-retention infrastructure covering data privacy and cybersecurity. Periodic internal audit/compliance review is required.
Old vs new: the 2021 framework and the 2026 framework
Under the 2021 framework, accreditation ran only through Accreditation Agencies — CDSL Ventures Ltd and NSDL Database Management Ltd — which verified income or net worth and issued a certificate. Eligibility was: income of at least Rs 2 crore, or net worth of at least Rs 7.5 crore (half in financial assets), or income of at least Rs 1 crore plus net worth of at least Rs 5 crore (Rs 2.5 crore in financial assets). The 2026 circular does not restate those thresholds; it frames eligibility under Regulation 2(1)(ab) on income, net worth or exposure and adds the exposure route. The old validity period is not stated as a number here, as sources conflict; validity is now uniformly three years, and existing certificates keep unexpired validity.
Why SEBI changed the framework now
SEBI's Board approved the review at its 215th meeting on 24 September 2026 (PR No. 59/2026), after a consultation paper on 13 August 2026 (PR No. 45/2026) that drew 486 responses by 3 September 2026. The site covered it here: SEBI accredited investor framework consultation 2026. Accredited investors grew from 649 (29 May 2025) to 4,492 (28 August 2026), holding AIF units of par value approx. INR 2.31 lakh crore as on 31 July 2026 — nearly 33% of total AIF investments.
The same amendment also substituted Regulation 25 of the AIF Regulations with a dispute-resolution mechanism for investor–AIF/manager disputes — from the Regulations amendment, not this circular, noted only briefly: read the amended Regulation 25 itself before relying on it.
Who is affected
- AIF Managers, SIF AMCs and portfolio managers may accredit investors, but must verify eligibility, confirm status in writing and keep evidence five years.
- Individuals, HUFs, family trusts and sole proprietorships with at least INR 5 crore of qualifying exposure have a new route, alongside income and net worth.
- Bodies corporate and other trusts need at least INR 20 crore of qualifying exposure under the new route.
- LLPs are expressly recognised, provided every partner independently qualifies.
- PROIs are deemed accredited, with no certificate needed — but full PMLA due diligence still applies.
- Investment Advisers and Research Analysts cannot accredit; they may rely on a valid Manager determination in their Group.
- Accreditation Agencies continue: a valid agency certificate must be relied on without a fresh determination.
- Existing accredited investors keep it for the certificate's unexpired period and the remaining life of schemes entered as accredited.
What to do next
For Managers:
- Adopt the accreditation policy first — conflict controls with separation from business development/distribution, escalation and grievance redressal, and record-retention infrastructure covering data privacy and cybersecurity.
- Build the paragraph 7 checklist: latest ITR or CA certificate (income); latest audited financials or a CA net worth certificate under six months old; eCAS under six months old or a CA certificate that the threshold was met within six months.
- Check for a valid agency certificate first — rely on it and do not re-determine during its validity.
- Document each decision (decision, criterion, verification), confirm status in writing with date and validity period, and retain records five years from accreditation or five years after the investor exits all your schemes — whichever is later.
- Include accreditation in periodic internal audit/compliance review; for PROIs, record the identification basis and complete PMLA due diligence.
For investors:
- Pick your route — income, net worth, or the new exposure route (INR 5 crore / INR 20 crore) — and gather the matching document first.
- Check document freshness: a net worth certificate or eCAS statement over six months old will not do; for unlisted/overseas holdings not valued in eCAS, get a practising CA certificate stating the nature, valuation date and value.
- If you hold a valid agency certificate, present it — your Manager must rely on it, not re-check you.
- Ask for the written confirmation with the date and validity period, and keep it as your record of when the three years started.
- LLP investors: check every partner. PROIs: expect PMLA questions on beneficial ownership and source of funds. Remember the group boundary — onboarding outside the Group means a fresh determination.
What the circular does not cover
The following are marked NOT CHECKED — the circular, as read for this article, does not address them:
- Whether any fee applies to Manager-led accreditation. NOT CHECKED — no fee is stated in the circular.
- Any deadline to adopt the accreditation policy. NOT CHECKED — the policy is required, but no deadline is stated in the provisions read.
- The substituted Regulation 25 dispute-resolution mechanism in detail. NOT CHECKED — it comes from the AIF (Third Amendment) Regulations, 2026, not this circular; read the amended Regulation 25 itself.
- Whether the 2021 income/net worth thresholds have changed. NOT CHECKED — the figures here are the 2021 prior-position figures, not a restatement by this circular.
FAQs
What is SEBI's 5 November 2026 circular on accredited investors?
SEBI Circular No. HO/19/34/11(6)2026-AFD-POD1/I/25244/2026, headed "Review of the framework for Accredited Investors", dated 5 November 2026, effective immediately. It lets AIF, SIF and PMS Managers determine accredited status, fixes validity at three years, adds an exposure route and deems PROIs accredited.
Can a fund manager accredit an investor without an accreditation agency?
Yes. An AIF manager, SIF AMC or portfolio manager may determine and record accredited status at onboarding or during a scheme's tenure after verifying eligibility. The agency route continues, and a valid agency certificate must be relied on without re-determination.
How long is accredited investor status valid?
Three years from accreditation, for both routes. Existing certificates keep unexpired validity, and an investor accredited at onboarding stays accredited for the remaining life of that scheme.
What is the minimum securities market exposure to become an accredited investor?
INR 5 crore for an individual, HUF, family trust or sole proprietorship, and INR 20 crore for a body corporate or other trust. Qualifying exposure includes demat securities, mutual fund folios, unlisted demat securities, overseas securities and NPS investments.
Can an Investment Adviser or Research Analyst accredit an investor?
No. They may not determine accredited status independently, but may rely on a valid determination by a Manager in their Group.
What documents prove accredited investor eligibility?
Income: latest ITR or a practising CA certificate. Net worth: latest audited financials or a CA net worth certificate under six months old. Exposure: eCAS statement under six months old, or a CA certificate that the threshold was met within the last six months.
Related reading
- SEBI accredited investor framework consultation 2026
- SEBI PROI KYC and digital onboarding for NRIs and OCIs abroad
Sources
- Primary source: SEBI Circular — "Review of the framework for Accredited Investors", No. HO/19/34/11(6)2026-AFD-POD1/I/25244/2026, 5 November 2026 — sebi.gov.in (official PDF)
- Official circular page: SEBI — Review of the framework for Accredited Investors — sebi.gov.in
- Background: SEBI Board, 215th meeting, 24 September 2026 (PR No. 59/2026); consultation paper, 13 August 2026 (PR No. 45/2026); AIF (Third Amendment) Regulations, 2026, No. SEBI/LAD-NRO/GN/2026/326 dated 9 October 2026.
Last verified by team: 5 November 2026, against the official SEBI circular PDF on sebi.gov.in. Every factual claim traces to that circular (prior position and background as described above); unaddressed points are marked "NOT CHECKED" above.
