Markets regulator SEBI's board approved a proposal to reintroduce open-market buybacks effective August 1, 2026, as announced by SEBI Chief Tuhin Kanta Pandey at a press conference on Friday. The board meeting deliberated on a wide-ranging agenda that also included faster clearance for AIF schemes and relaxed intraday borrowing rules for mutual funds. According to Zee News, these measures are aimed at improving market efficiency, easing compliance requirements and enhancing investor protection across various segments of the financial markets. The reintroduction of open-market buybacks comes just a year after the route was phased out, following the revised taxation framework applicable to buybacks. The approval represents the sixth board meeting chaired by SEBI Chairman Tuhin Kanta Pandey since he assumed office on March 1, 2025. As per Zee News, the open market buyback route was discontinued in April 2025 amid concerns around unequal treatment of shareholders and issues arising from the prevailing income tax framework, but these concerns were subsequently addressed through amendments in the Finance Bill 2024 and changes to the Income Tax Act, 2025.
SEBI has approved a new Green-Channel mechanism – GARUDA to significantly accelerate the launch of alternative investment fund schemes. The framework reduces the waiting period from 30 days to 10 working days in most cases, enabling fund managers to deploy capital more quickly into start-ups, private credit, infrastructure and other investment opportunities. Under the revised process, most AIF schemes will be permitted to commence operations 10 working days after the placement memorandum is filed with SEBI through a merchant banker, provided the regulator does not raise any concerns. For the inaugural scheme of a newly registered AIF, launch eligibility will begin either on the date registration is granted or after the expiry of the 10-working-day period following placement memorandum submission, whichever occurs later. The initiative, designed to simplify the launch process while ensuring investor protection and regulatory accountability, reflects the growing scale and maturity of India's AIF ecosystem and is intended to support faster capital allocation without compromising regulatory standards. The changes come amid rapid growth in India's AIF industry, with the number of registered AIFs rising to 1,849 as of March 31, 2026, from 732 five years ago, marking a 135% growth. According to SEBI data, cumulative commitments raised by AIFs stood at ₹15.74 lakh crore, while net investments reached ₹6.45 lakh crore as of December 31, 2025.
SEBI has introduced a separate route for schemes catering exclusively to Accredited Investors as well as Angel Funds, allowing these vehicles to submit their placement memorandums directly to SEBI without engaging a merchant banker. Instead of a due diligence certificate from a merchant banker, the responsibility for regulatory compliance will rest with the AIF manager. Senior officials, including the Chief Executive Officer, Compliance Officer and other authorised personnel, will be required to provide declarations confirming adherence to AIF regulations and applicable legal requirements. Following acknowledgement of the submitted documents under the GARUDA framework, eligible schemes may proceed with their launch without being subjected to the current pre-launch review timeline. The regulator emphasised that the streamlined process does not represent a relaxation of supervision, with scheme documents continuing to be reviewed through a risk-based post-launch scrutiny mechanism and SEBI retaining authority to take action where disclosures are found to be inaccurate, incomplete or in breach of regulatory norms. As per The Hindu BusinessLine, Angel Funds and Accredited Investor-only (AI-only) schemes can now launch immediately once the Private Placement Memorandum (PPM) is filed and SEBI acknowledges receipt, completely bypassing the previously mandatory merchant banker certification. For these specialized funds, the responsibility of compliance shifts entirely to self-certification by the fund's CEO and Compliance Officer.
The approved framework establishes open market buyback limits of 66 working days for companies to repurchase shares directly from stock exchanges, marking a substantial reduction from the earlier system that permitted buybacks to remain open for as long as six months. Under the new regime, companies undertaking buybacks through the open-market route would be required to complete the process within 66 working days from the opening of the offer. To prevent companies from delaying purchases until the end of the programme, SEBI has stipulated that at least 40% of the proposed buyback amount must be utilised during the first half of the buyback period. To reduce compliance costs, SEBI has made the appointment of a merchant banker optional for such buybacks, reducing compliance costs for companies. At present, buybacks can be undertaken through the tender offer route and the open-market route through book building. The open-market buyback route through stock exchanges will be reintroduced from August 1, 2026, to provide companies with an additional buyback option. Promoters and their associates will not be allowed to participate, and their holdings will remain frozen during the buyback period. The regulator has implemented comprehensive safeguards including requiring promoter shares to be locked in during buybacks and prohibiting transactions that would breach the minimum 25% public float requirement. These measures are specifically designed to improve market efficiency and streamline the buyback process for companies, offering a more efficient and equitable way for companies to return capital to shareholders.
SEBI has approved a framework allowing mutual funds to undertake intra-day borrowings to manage temporary liquidity mismatches arising from settlement timing differences across asset classes. The borrowing limit will be restricted to receivables expected during the day, with additional borrowing beyond this limit not permitted, except for meeting unitholder payouts. As per Zee News, the borrowing facility can be used for operational requirements such as settlement timing differences, foreign exchange settlements and mark-to-market obligations in derivatives. Currently, mutual funds use intra-day borrowing facilities primarily to meet redemption-related payouts, income distribution-cum-capital withdrawal obligations, and interest payments. The framework represents a significant development for mutual fund operations, providing them with greater flexibility to manage short-term liquidity requirements while maintaining regulatory oversight. Asset management companies will be responsible for ensuring compliance and maintaining adequate documentation and internal policies governing the use of such borrowings.
SEBI has approved amendments to municipal debt securities regulations to develop the municipal bond market in India, introducing significant changes to support retail participation and operational flexibility. The revised framework will allow municipalities to raise funds to refinance the existing debt of specific projects, with municipalities required to disclose details of existing lenders and loans being refinanced in offer documents or placement memorandums. To encourage retail participation, issuers will be permitted to offer incentives such as additional interest or discounts on issue price to certain categories of investors, including senior citizens, women, serving and retired defence personnel, widows and widowers of defence personnel, retail individual investors and other specified categories. Securities issued with a face value of ₹10,000 will have a fixed maturity and cannot contain structured obligations, while securities with a face value of ₹1 lakh may have structured obligations. Considering the complexity and diversity of municipal operations, SEBI relaxed post-issue compliance timelines, extending the deadline for submitting unaudited half-yearly financial results from 45 days to 60 days and the timeline for audited annual financial results from 60 days to 90 days from the end of the respective periods. The regulator also provided clarity on fundraising by two or more municipalities through pooled finance vehicles, specifying disclosure requirements and operational aspects such as agreements between pooled finance special purpose vehicles and municipalities, and escrow account mechanisms for repayment arrangements.
The SEBI board also approved a simplified and standardised framework for transmission of securities to legal heirs and claimants of deceased investors. A new quick transmission processing (QTP) category has been introduced for small-value claims of up to ₹10,000 in physical holdings and up to ₹30,000 in dematerialised holdings. The regulator has doubled the threshold for simplified documentation in physical holdings per listed company to ₹10 lakh from ₹5 lakh, and for dematerialised holdings per beneficial owner to ₹30 lakh from ₹15 lakh. SEBI has also eased documentation requirements by removing the need for PAN submission and doing away with mandatory submission of a Probate of Will. These changes are designed to streamline the process of securities transmission to legal heirs and claimants, reducing administrative burden and improving efficiency in settling deceased investor claims. QR-coded death certificates have also been made acceptable documents, with the regulator expecting the changes to reduce procedural hurdles and enable faster settlement of claims. For death certificates issued in foreign jurisdictions, the regulator has specified additional verification mechanisms through overseas branches of Indian banks or foreign banks having correspondent banking relationships with Indian banks.
