Social Stock Exchange

Why in News?

  • Recently, National Stock Exchange of India received final approval from SEBI to set up the Social Stock Exchange (SSE).


  • The SSE would function as a separate segment within the existing stock exchange and help social enterprises raise funds from the public through its mechanism.
  • It would serve as a medium for enterprises to seek finance for their social initiatives, acquire visibility and provide increased transparency about fund mobilisation and utilisation.
  • Retail investors can only invest in securities offered by for-profit social enterprises (SEs) under the Main Board.
  • In all other cases, only institutional investors and non-institutional investors can invest in securities issued by SEs.
  • Any non-profit organisation (NPO) or for-profit social enterprise (FPSEs) that establishes the primacy of social intent would be recognised as a SE, which will make it eligible to be registered or listed on the SSE.
  • 17 plausible criteria under SEBI’s ICDR Regulations, 2018 include serving to eradicate hunger, poverty, malnutrition, promoting education, employability, equality, and environmental sustainability among others
  • Corporate foundations, political or religious organisations, professional or trade associations, infrastructure and housing companies (except affordable housing) would not be identified as SE
  • NPOs would be deemed ineligible if dependent on corporates for more than 50% of its funding.
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