NSE receives final approval to launch Social Stock Exchange as a separate segment

The exchange had previously received approval in principle from Sebi to launch the SSE platform and was awaiting the final nod.

The SSE segment will provide social enterprises with a new opportunity to fund social initiatives, give them visibility and bring more transparency to the mobilization and use of funds by social enterprises. Any social enterprise, non-profit organization (NPOs) or For-Profit Social Enterprises (FPEs) that establishes the primacy of social intent can be registered/listed on the SSE segment, NSE said in a statement.

For eligible NPOs, the first onboarding step begins with registering on the Social Stock Exchange segment. Once registered, NPOs can start the fund mobilization process by issuing instruments such as Zero Coupon Zero Principal (ZCZP) through public offering or private placement. Currently, the regulations have prescribed the minimum issue size as 1 crore and minimum application size for subscription to 2 lakhs for ZCZP issuance,” the circular read.

For FPE, the process of issue and listing of securities is the same as applicable for the issue and listing of securities under the Exchange’s existing processes (based on eligibility criteria for the Mainboard, SME platform or the innovators growth platform, as applicable in addition to the provided eligibility criteria as social enterprises),” it added.

“To raise awareness, we have hosted several events and are holding social enterprises that are currently in various stages of onboarding on the Exchange. I am taking this opportunity to ask social enterprises to reach out to our teams to discuss the mechanism and benefits of registration and listing on the Social Stock Exchange segment,” said NSE MD and CEO, Ashishkumar Chauhan.

Union Finance Minister Nirmala Sitharaman, in her speech on the Union budget of 2019-2020, had proposed the establishment of an SSE, under the regulatory action of Sebi, for the listing of social enterprises and voluntary organizations that work towards achieving a social welfare objective so that they can raise capital as equity, debt or as units such as a mutual fund (MF).

In October last year, the BSE stock exchange had received a nod in principle from the capital market regulator SEBI for the SSE as a separate segment.