The National Stock Exchange of India (NSE) on Thursday said that it received final approval from the Securities and Exchange Board of India (SEBI) to set up a Social Stock Exchange (SSE) as a separate segment of the NSE. The Social Stock Exchange segment will provide a new avenue for social enterprises to finance social initiatives, provide them visibility and bring in increased transparency in fund mobilisation and utilisation by social enterprises, the exchange said in its statement.
SSE is a novel concept in India and such a bourse is meant to serve the private and non-profit sectors by channeling greater capital to them. The idea of SSE was first floated by Finance Minister Nirmala Sitharaman in her Budget speech for the financial year 2019-20.
NSE’s MD and CEO Ashishkumar Chauhan said, “To bring in awareness, we have been conducting various events and hand-holding Social Enterprises currently at various stages of onboarding on the Exchange. I take this opportunity to request Social Enterprises to get in touch with our teams to understand the mechanism and benefits from registering & listing on the Social Stock Exchange segment."
Any social enterprise, Non-Profit Organization (NPOs), or For-Profit Social Enterprise (FPEs), that establishes its primacy of social intent can get registered or get listed on the Social Stock Exchange segment.
For eligible NPOs, the first step for onboarding starts with registration on the Social Stock Exchange segment.
Post registration, NPOs can initiate the fund mobilisation process by the issuance of instruments such as Zero Coupon Zero Principal (ZCZP) via a public issue or private placement. Currently, the regulations have prescribed the minimum issue size as Rs 1 crore and the minimum application size for subscription at Rs 2 lakhs for ZCZP issuance, NSE said.
For FPE, the process of issuing and listing of securities would be the same as applicable for the issue and listing of securities under the extant processes of the exchange - -- based on eligibility criteria for the main board, SME Platform, or innovators growth platform, as applicable in addition to the criteria provided to be eligible as Social Enterprises.