How to List NGO in Social Stock Exchange?

India’s Social Stock Exchanges – now live on both NSE and BSE – aim to bridge social purpose and capital markets, enabling social enterprises to fundraise through securities-based instruments. Here's how they work, who can participate, and what the process involves. If you are the one who is looking to register NGO in social stock exchange, the this blog is perfect for you. Here we have covered all the  information in details  

What is the Social Stock Exchange?

A Social Stock Exchange (SSE) is a specialised segment within a recognised bourse (such as BSE or NSE), created under SEBI, to enable both Not-for-Profit Organisations (NPOs) and for Profit Social Enterprises (FPSEs) to raise funds. The idea was first floated in the 2019 Union Budget and structured through SEBI’s amendments to ICDR, LODR, and AIF Regulations in 2022

These entities can raise capital for social goals via:

• Zero Coupon Zero Principal Instruments (ZCZPIs) – specially crafted securities for NPOs
• Equity or debt issuance – for FPSEs under appropriate exchange segments
• Development Impact Bonds, mutual fund schemes, and other instruments SEBI might specify.

*Note: Mutual fund schemes and other instruments are potential future inclusions; SEBI has not formally notified them as of June 2025.

Who Can Participate?

A. Not for Profit Organisations (NPOs)

To register (not necessarily list) on SSE, an NPO must meet SEBI’s Regulation 292F criteria:

1. Registered in India as:

• a charitable trust under state law,
• a society under Societies Registration Act 1860,
• or a Section 8 company under Companies Act 2013.

2. In existence and operational for at least 3 years.

3. Hold valid Income Tax certificates: 12A/12AA/12AB and 80G.

4. Have minimum financial thresholds in the last fiscal:

• spending at least ₹50 lakh,
• with at least ₹10 lakh in funds on hand.

5. Not barred by SEBI, RBI, or other authorities (e.g. not fugitive, defaulter or debarred).

6. Additional exchange-level filters (e.g., minimum donor base or impact domain) may also apply and differ across NSE and BSE SSE platforms.

B. For Profit Social Enterprises (FPSEs)

1. FPSEs must:

• Be a Company or body corporate (profit-making).
• Establish primacy of social intent, i.e., demonstrate at least 67% of revenue or activities serve eligible social causes.
• Meet the applicable eligibility norms of the target segment (mainboard, SME, or Innovators Growth platform).
• Also comply with the same debarment and default checks as NPOs.
• Registration on SSE is optional for FPSEs unless they seek to list as a “social enterprise” under the SSE segment.

Eligible Social Activities

Qualifying activities are drawn from:

• Schedule VII of the Companies Act,
• UN Sustainable Development Goals,
• NITI Aayog priorities.

Common areas include poverty alleviation, education, healthcare, skill development, sanitation, environment, and gender equality.

Instruments & Ways to Raise Funds

1. Zero Coupon Zero Principal Instruments (ZCZPIs)

• These are bond-like instruments with no interest or principal repayment.
• NPOs use them to raise capital; proceeds go entirely to social causes.
• Units now accessible to small investors: minimum subscription of ₹1,000 (reduced from ₹10,000 by SEBI’s March 2025 amendment).
• SEBI also proposed future enhancements such as UPI integration and increased market accessibility in its March 2025 consultation paper.

2. Equity and Debt for FPSEs

• FPSEs list shares or bonds in their exchange segment, marked as social enterprises.

3. Development Impact Bonds (DIBs)

• Structured contracts with outcome-based funding: donors pay only on achieved outcomes.
• Managed on SSE platform; formal frameworks are evolving in consultation with stakeholders.

Other Instruments- Additional tools like mutual fund schemes or outcome-linked finance models may be introduced in the future, subject to SEBI notifications.

Registration and Listing Process

Step 1: Registration

• NPOs must register before raising funds via SSE.
• FPSEs registering is optional if listing directly.
• Exchange issues clear application forms (Annexures I–IV), requiring entity details, certifications, financials, governance, and impact plans.

Step 2: Eligibility Check

• Exchange and SEBI examine documents, financials, debarments, social intent, and certifications.

Step 3: Public Consultation

• For fund raises (e.g., through ZCZPIs), draft documents are posted on the exchange site for 21 days for public feedback.

Step 4: Issuance

• Upon approval, issuance happens through private placement or public offer.
• For FPSEs, issuance follows standard board segment rules.

Timeline & Key Timeframes

Overall registration to issuance takes around 3–6 months; timelines vary by entity readiness.

Post Issuance: Reporting & Compliance

Disclosure Requirements under LODR

• Entities must report on operational, financial, governance, and impact metrics applicable to social enterprise segments.

Annual Impact Report (AIR)

• NPOs must publish an AIR detailing social outcomes, targets, financial allocations, and governance.
• FPSEs share a social impact scorecard – highlighting reach, intensity, and dimensions across income, equity, inclusion.

Audit & Monitoring

• Compliance with SEBI’s social audit standards; third-party audits are common.
• Exchanges monitor ongoing compliance; non-performance can lead to delisting or de-registration.

Costs & Fees

• Registration fees vary by exchange.
• Issuance costs include public notice, consultant fees, legal expenses, auditor charges.
• FPSEs also pay listing and annual maintenance fees akin to regular board listings.
• SEBI charges like application or regulatory fees may also apply.

(Exact fees differ by exchange; consult BSE/NSE platforms for current schedules.)

Benefits of SSE Listing

• Access to broader donor and investor base.
• Enhanced credibility through due diligence and compliance.
• Increased transparency through impact disclosures.
• Leverage for CSR funding; CSR donors can choose listed entities.
• Opportunity to engage retail investors via small-ticket instruments like ZCZPIs.

Essential Elements & Governance

Good governance requires:

• Robust board oversight with independent directors.
• Clear social mission tied to financial structures.
• Defined metrics and impact targets.
• Transparent disclosures and impact auditing.
• Community or beneficiary representation in governance.
• Tight control over fund usage and restricted promoter benefits.

Timeline Snapshot

• July 2022: ICDR, LODR, and AIF regulations amended to introduce SSE framework.
• 19 September 2022: SEBI publishes detailed circular with registration/lodging requirements.
• Dec 2023: Amendments further refine ZCZPI rules.
• Mar 2025: SEBI reduces minimum ZCZPI investment threshold to ₹1,000.
• Mar 2025: Consultation paper explores future enhancements, including UPI, digital investor access, and expanded instruments.

Conclusion

India’s SSE offers an innovative pathway for social change:

• NPOs can register and issue ZCZPIs,
• FPSEs can list for equity/debt fundraising,
• Tools like DIBs, mutual fund schemes, and others may follow.

With transparent and credible reporting and impact-driven instruments, SSE encourage accountability, builds trust and mobilises capital for development goals. As regulations evolve and the instruments mature, SSE promises to democratise social finance, making it easier for credible organisations to access funding and create measurable impact. If you are seeking for any professional help for your NGO registration in SSE, do contact CRSPL Business Consultants, they will guide at every step.

Note: This blog is grounded in SEBI circulars and official exchange documents (Sept 2022, Dec 2023, Mar 2025 amendments). For detailed forms, fee schedules, and filing formats, please visit the BSE Social Stock Exchange and NSE SSE official portals.