SEBI To Frame New Norms For Startup Ecosystem, Plans To Tap Social Media To Enhance Investor Awareness

Aiming to help young entrepreneurs raise funds through crowdsourcing and listing of startups, the market regulator – the Securities and Exchange Board of India (Sebi) is framing new norms for startup ecosystem and planning to tap growing stature of social media for enhancing investor awareness and education.

The market regulator is also looking forward to further streamline its enforcement process to ensure uniformity in its approach and improve the efficiency of its enforcement proceedings across the organisation.

The new roadmap will be framed after the consultation process with the government and other stakeholders, follows proposals made by Finance Minister Arun Jaitley in the Union Budget.

Speaking on the plans, Sebi said, “it would take proactive steps to meet the aspirations of young entrepreneurs and cater to the financing and listing needs of startups with measures like Institutional Trading Platform (ITP), crowdfunding etc or a separate carve out for them in the ICDR (Issue of Capital and Disclosure Requirements) Regulations.”

The statement further states that Sebi would also enhance significantly its investor education and awareness efforts through tie up with other agencies and empanelment of more Resource Persons. Besides, the initiatives planned for the next fiscal also include an extensive and integrated use of technology to facilitate and further ease the investing process in the securities markets through measures like e-IPO and Aadhar-based e-KYC.

Sebi also plans to upgrade its website to enhance the experience and interface of investors and other stakeholders. These initiatives were approved by the regulator’s board today along with its budget for the year. Recently, the Sebi has also announced that it is looking at options to ease rules on mandatory disclosure for the draft prospectuses of Internet-based companies.

It is to be noted that earlier in December, U K Sinha, chairman of Sebi, had met with a group of entrepreneurs, over day-long closed-door sessions to voice issues faced by them and also understand the regulator’s concerns around new-technology companies. The meeting was organised by software product think-tank iSpirit and was attended by top exceutives of Eztap, Exotel, HotelLogix, InMobi, Paytm, Quickheal, Deck.in and iViz.