Nirmal: Rahul, I recently read in the newspaper that the newly introduced Specialised Investment Funds (SIFs) have a minimum investment of ₹10 lakh for regular investors, but just ₹1 lakh for accredited investors. What exactly does that mean?
Rahul: Well, Nirmal, accredited investors are a special class of investors recognised by SEBI. They are considered financially sophisticated and capable of understanding complex investment products. Because of their expertise and higher risk appetite, they get lighter regulations, relaxation in minimum investment thresholds, and access to exclusive investment opportunities.
Nirmal: I see. But who qualifies as an accredited investor? Can I become one?
Rahul: Of course! If you meet SEBI’s eligibility criteria, you can become an accredited investor. For individuals, you need to satisfy at least one of these conditions: an annual income of ₹2 crore or more, or a net worth of at least ₹7.5 crore, out of which at least ₹3.75 crore in financial assets, or a combination of an income above ₹1 crore and a net worth over ₹5 crore with ₹2.5 crore in financial assets. Your primary residence isn’t counted in the net worth, but unoccupied second homes can be included. Similar criteria apply to firms, trusts, and family offices.
Nirmal: Interesting. How does one apply for this status?
Rahul: You need to get an accreditation certificate from SEBI-notified agencies like CDSL Ventures or NSDL Data Management Ltd. You submit your documents proving income and net worth, and the agency verifies them. Once approved, you receive the certificate. Documents required include your latest income tax returns, audited financial statements, net worth certificates, salary slips, or other proofs of income. For firms or trusts, audited financial statements and incorporation documents are needed. Applications go to the SEBI-accredited agencies. The process usually takes 2–4 weeks. If approved based on your previous financial year’s data, the certificate is valid for two years. If based on two years’ data, it can be valid for three years. The cost is around ₹10,000 for two years or ₹14,500 for three years.
Nirmal: And what are the benefits?
Rahul: Many, Nirmal! First, accredited investors can access PMS and AIFs at much lower minimum ticket sizes. For instance, the minimum investment for regular investors in PMS is ₹50 lakh, while for accredited investors it can be around ₹10 lakh; in AIFs, it can be around ₹25 lakh compared to ₹1 crore for others. Other benefits include the ability to tap flexibly into private placements, pre-IPOs, venture capital, hedge funds, and even overseas funds via GIFT City. They enjoy more flexible exit options, higher allocation limits in large-value funds, and can negotiate fee structures. Essentially, it allows them to invest like a professional with fewer restrictions.
Nirmal: That’s impressive. How has investor participation been since the framework was introduced? Have many people benefited?
Rahul: Not really. Participation has remained limited since its introduction in 2021, mainly due to lack of awareness, reluctance to disclose financial information, and the somewhat tedious accreditation process. As of May 2025, India has only about 649 accredited investors, compared to 24 million in the US. To improve this, SEBI is gradually relaxing thresholds for large-value funds, removing self-declaration, and extending angel funding and co-investment privileges exclusively to accredited investors. These measures make participation easier, align India with global standards, and encourage the development of innovative alternative investment products.
Nirmal: That makes sense. Thank you.
Published on October 11, 2025
