The Securities and Exchange Board of India (Sebi) is planning to tighten and standardise advertising guidelines for online bond platform providers (OBPPs), according to people close to the development. The proposed framework will impose stricter rules on promotional content to enhance investor protection and ensure greater transparency in communication. As reported by The Financial Express, this move comes amid growing retail participation in bonds, driven partly by subdued equity market performance this year. The latest developments show that Sebi is also considering lowering entry barriers for bond platform providers and enabling wider product offerings to deepen retail participation in fixed income markets, as reported by NDTV Profit.
Several platforms have been promoting low-rated bonds by highlighting higher returns without adequately disclosing the associated risks, potentially creating a misleading impression among investors. According to The Financial Express, while OBPPs may continue to use terms such as 'fixed returns', they will have to carry disclaimers clarifying that such returns are not guaranteed. This regulatory intervention aims to address concerns over mis-selling and unregistered platforms that have been offering OBPP services without obtaining registration from stock exchanges.
Last year, Sebi and stock exchanges cautioned investors about the risks and complexities associated with fixed-income securities, as reported by The Financial Express. In a November 2025 communication, the regulator noted that certain entities, including fintech firms and stock brokers, were offering OBPP services without obtaining registration from stock exchanges. Investors were advised to transact only through registered platforms and verify registration status. Earlier in July 2025, stock exchanges issued a joint advisory warning investors about risks associated with bond trading, advising them to evaluate factors such as credit ratings, issuer credibility, liquidity, settlement processes and tax implications.
Sebi Chairman Tuhin Kanta Pandey highlighted the need to improve public awareness about debt products and said the regulator plans to launch investor awareness campaigns. According to The Financial Express, Pandey emphasized that retail participation will not grow merely because products are available, but will grow when products are understood. He noted that bonds have their own vocabulary including 'coupon, yield, duration, rating and different types of risks' that must be made investor-friendly. Separately, Sebi is also working on introducing a distribution framework for fixed-income products, aimed at strengthening safeguards and reducing instances of mis-selling.
