SEBI tweaks framework for online bond platform providers to boost ease of doing biz

Capital markets regulator SEBI on Thursday tweaked the regulatory framework for online bond platform providers (OBPPs) to enhance the ease of doing business.

This came after SEBI received representations from stock exchanges and market participants, including online bond platforms.

"The proposed modifications shall aid in ease of doing business for OBPPs," the Securities and Exchange Board of India (SEBI) said in a circular.

Under this, the regulator has modified the framework pertaining to the issue of order receipt, deal sheet and quote receipt in case of products, securities or services.

On placement of an order by an investor, SEBI said that OBPPs will have to issue without delay an electronic order receipt which includes the date and time of the order, details of counter-parties involved, quantity and amount proposed to be transacted.

After the execution of the order, the entity will issue a deal sheet to the investor for all transactions, stating all the relevant information regarding the transaction which includes the date and time of placing of the order, settlement of the order, details of counter-parties involved, quantity and amount transacted.

Additionally, SEBI said that all advertisements will be accompanied by a standard warning in legible font stating "investments in debt securities/ municipal debt securities/ securitised debt instruments are subject to risks including delay and/ or default in payment..." It further said that no addition or deletion of words will be made to the standard warning.

The regulator said online bond platform providers can offer securities such as government securities, treasury bills, listed sovereign gold bonds, listed municipal debt securities, and listed securitised debt instruments and other products or securities that are regulated by a financial sector regulator such as SEBI, RBI, IRDAI or PFRDA, on their online bond platforms.

Under the rules, OBPPs need to register themselves as stock brokers in the debt segment of the stock exchange. OBPs offer an avenue for investors, particularly non-institutional investors to access the bond market.