

AIFs seek easier accreditation process, sharper incentives for wealthy investors
Subscribe to enjoy similar stories.MUMBAI: India’s alternative investment fund industry is seeking to widen access to a small but fast-growing pool of wealthy investors, arguing that a cumbersome accreditation system and limited incentives are slowing participation even as the sector scales sharply.The industry has made a representation to the Securities and Exchange Board of India (Sebi) seeking a simpler accreditation system and stronger regulatory benefits for accredited investors, according to two people aware of the development.“AIFs made a representation to Sebi last month to make the accreditation process more friendly for investors,” one of the people said on condition of anonymity. “Accredited investors also need proper incentives to grow this segment.
As of now, investors don't get a lot if they go through the tiresome process and become accredited.”At stake is access to a ₹15.75 trillion alternative investment market that has grown rapidly, even as the accredited investor ecosystem remains small.“If you look at the size of the industry, it stands to reason that there would be a minimum of at least 1 lakh investors in this asset class. Out of 1 lakh, barely 3% have actually made this entire cut,” the first official said.As of April, Sebi data shows there were 2,773 accredited investors, up from 649 in May 2025.
These investors account for about 30% of total AIF investments, which stood at ₹1.91 trillion as of December last year.Accredited investors are individuals or entities deemed financially sophisticated enough to take on higher-risk investments. Individuals qualify with an annual income of at least ₹2 crore or a net worth of ₹7.5 crore, with at least half in financial assets, among other criteria.
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