Master Circular for Merchant Bankers

MASTER CIRCULAR

HO/49/14/15(3)2026-CFD-POD1/I/16178/2026

Issued on: September 26, 2023 Last updated on: July 14, 2026

To All Registered Merchant Bankers

Dear Sir / Madam,

Subject: Master Circular for Merchant Bankers Registered with SEBI

1. For effective regulation of Merchant Bankers, the Securities and Exchange Board of India has been issuing various Circulars from time to time under the relevant provisions of the Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992 (hereinafter referred to as “MB Regulations”)

2. In order to enable Merchant Bankers and other market stakeholders to have access to all applicable Circulars in the subject matter at one place, this Master Circular is issued. This Master Circular has been updated to reconcile with the MB Regulations as amended vide notification dated December 5, 2025 which has come into effect from January 3, 2026 and to incorporate the provisions of the Circulars dated May 02, 2017, January 02, 2026 & June 11, 2026 and bearing reference numbers SEBI/HO/MIRSD/MIRSD1/CIR/P/2017/38, HO/49/11/11(106)2025-CFD-RAC-DIL3/I/1796/2026 & HO/49/14/15(2)2026-CFD-POD1/I/13567/2026 on the subjects ‘Online Registration Mechanism for Securities Market Intermediaries’, ‘Specification of the consequential requirements with respect to Amendment of Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992’ & ‘Extension of timelines for compliance with certain provisions of Circular dated January 02, 2026’ respectively.

3. With the issuance of this Master Circular, all directions/instructions contained in the circulars listed out in the Appendix to this Master Circular shall stand rescinded to the extent they relate to the Merchant Bankers.

4. Notwithstanding such rescission, -

(a) anything done or any action taken or purported to have been done or taken under the rescinded circulars, prior to such rescission, shall be deemed to have been done or taken under the corresponding provisions of this Master Circular; and

(b) any application made to the Board under the rescinded circulars, prior to such rescission, and pending before it, shall be deemed to have been made under the corresponding provisions of this Master Circular, and

(c) the previous operation of the rescinded circulars or anything done or suffered thereunder, any right, privilege, obligation or liability acquired, accrued or incurred under the rescinded circulars, any penalty, incurred in respect of any violation committed against the rescinded circulars, or any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty as aforesaid, shall not be affected by such rescission and shall be enforceable as if the rescinded circulars had continued to be in force.

5. This Master Circular is issued in exercise of the powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, to protect the interests of investors in securities and to promote the development of, and to regulate, the securities market. (“SEBI Act”).

6. This Master Circular is available on the website of SEBI at www.sebi.gov.in in the path “Legal >Master Circulars’.

Yours sincerely,

Vimal Bhatter Deputy General Manager Policy and Development Corporation Finance Department Phone + 91-022-40459386 Email: vimalb@sebi.gov.in

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Table of Contents

List of Abbreviations .....................................................................................................5 CHAPTER I –REGISTRATION RELATED MATTERS ...................................................6

1. Online Registration Mechanism for Merchant Bankers .................................. 6
2. [***]¹ Deployment of Funds ............................................................................ 6
3. Conditions for granting registration to applicants notwithstanding that a connected persons has been previously granted registration .................................................. 7
4. Designated e-mail ID for redressal of investor complaints and regulatory communication with SEBI ................................................................................................................... 8
5. Prior approval for change in control ............................................................... 9
6. Transfer of business by SEBI registered intermediaries to other legal entity12 26A. Conditions for compliance with revised capital adequacy and new liquid net worth requirements as well as timelines to re-categorize as Category I or Category II for Merchant Bankers ................................................................................................................. 13 26B. Definition of liquid net worth......................................................................... 15 26C. Compliance with Conditions for requisite certification.................................. 16 26D. Requirement of compliance officer to be independent from other employee17 26E. Requirement of principal officer with relevant experience............................ 17 CHAPTER II - GENERAL OBLIGATIONS AND RESPONSIBILITIES.........................19
7. Regulatory Compliance and Periodic Reporting .......................................... 19
8. Disclosure of Track Record of the public issues managed by Merchant Bankers 20
9. Publishing Investor Charter and Disclosure of Complaints by Merchant Bankers on their Websites................................................................................................................ 20
10. Advisory for Financial Sector Organizations regarding Software as a Service (SaaS) based solutions.......................................................................................................... 21 ²(10A) .................... Conditions for compliance in respect of underwriting obligations 22 ²(10B) ..Compliance with requirement of minimum revenue from permitted activities 22 ²(10C)Disclosure to be made by Merchant Banker where it is only involved in the marketing of an issue................................................................................................. 23 ²(10D)Conditions to be complied with by Merchant Bankers for carrying out activities other than permitted activities ................................................................................................. 23 CHAPTER III – OTHER GUIDELINES ..........................................................................26
11. Processing of Investor Complaints in SEBI Complaints Redress System (SCORES) 26
12. Prevention of circulation of unauthenticated news by SEBI Registered Market Intermediaries through various modes of communication...................................... 26 ²12A. Merchant Banker not to outsource its core merchant banking activities ...... 27
13. Guidelines on Outsourcing of Activities by Merchant Bankers..................... 27
14. General Guidelines for dealing with conflicts of interest of merchant bankers and their associated persons in Securities Market ............................................................... 28 ANNEXURE I......................................................................................................... 30 ANNEXURE II........................................................................................................ 31 ANNEXURE III....................................................................................................... 33 ANNEXURE IV ...................................................................................................... 42 ANNEXURE V ....................................................................................................... 48 ANNEXURE VI ...................................................................................................... 93 ANNEXURE VII ..................................................................................................... 95 ANNEXURE VIII .................................................................................................... 97 ANNEXURE IX ...................................................................................................... 98 Appendix ....................................................................................................................104

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List of Abbreviations

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CHAPTER I –REGISTRATION RELATED MATTERS

1. Online Registration Mechanism for Merchant Bankers³

1.1. The SEBI Intermediary Portal is available at https://siportal.sebi.gov.in for SEBI registered intermediaries including Merchant Bankers to submit registration applications online. SEBI Intermediary Portal includes online application for registration, processing of application, grant of final registration, application for surrender/cancellation, submission of periodical reports, requests for change of name/ address/ other details, etc. The link for SEBI Intermediary Portal is also available on SEBI website – www.sebi.gov.in.

1.2. All applications for registration / surrender / other requests are required to be made through SEBI Intermediary Portal only. The applicants are separately required to submit relevant documents viz. declarations / undertakings required as a part of application forms prescribed in relevant regulations, in physical form, only for records without impacting the online processing of applications for registration.