Zerodha’s Nithin Kamath hails Sebi’s move that boosts retail participation in bond market

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₹10,000 from ₹1 lakh at present, which is believed to enhance the participation of retail investors in the debt market. “Companies can now issue bonds with face value of ₹10,000. This is a great move that can help attract retail participation in the bonds.

With all the changes in the last few years, SEBI has done an amazing job of making bonds accessible to small investors," Kamath wrote in a post on X. Kamath had earlier spoke out against non-availability of bonds to retail investors. Bonds have been an HNI product, and no one sold them to retail, he had said.

“There were two big issues: 1. Availability of bonds with small face values. Most bonds are issued through private placements and have face values of ₹10 lakh+.

So retail investors were priced out. 2. All bond deals had to be settled through the clearing corporations, and they only accepted RTGS as a payment mode.

So the minimum transaction size became ₹2 lakh + by default," Kamath wrote in January 2023. Also Read: Sebi steps in to curb front-running by mutual funds However, Sebi has made some key changes that make it easy for retail investors to invest in corporate bonds, he noted. Apart from lowering the denomination, Sebi has standardised the record date for identifying eligible holders, harmonised the format of the due diligence certificate provided by the debenture trustee and provided flexibility regarding publication of financial results in newspapers for entities that have listed only non-convertible securities.