CIRCULAR
HO/49/14/15(2)2026-CFD-POD1/I/13567/2026 June 11, 2026
To,
All Registered Merchant Bankers (MBs)
Madam/Sir,
Subject: Extension of timelines for compliance with certain provisions of Circular dated
January 02, 2026
1. SEBI (Merchant Bankers) (Amendment) Regulations, 2025 (“MB Amendment
Regulations”) were notified on December 05, 2025, inter alia, revising the net worth
and liquid net worth requirements applicable to Merchant Bankers and introducing
Regulation 13A relating to activities that may be undertaken by Merchant Bankers and
segregation of other activities through Separate Business Units (“SBUs”).
2. In this regard, SEBI issued Circular No. HO/49/11/11(106)2025-CFD-RAC-
DIL3/I/1796/2026 dated January 02, 2026 (“MB Circular”), inter alia, specifying the
operational framework, implementation timelines and compliance requirements for
Merchant Bankers.
3. Based on representations received from the industry highlighting operational
challenges in establishing the necessary systems and processes for implementation
of the SBU framework and seeking alignment of the compliance timeline for net worth
and liquid net worth requirements with the end of the financial year, it has been decided
to grant additional time for compliance with the aforesaid requirements.
4. Accordingly, the timelines prescribed under the MB Circular dated January 02, 2026
shall be as under:
S. Existing
Requirement New Timeline
no. Timeline
Transfer of activities to Separate
Business Unit(s) in terms of
a. December 31,
Regulation 13A(2) of the MB July 03, 2026
2026
Regulations and Clause 11.2.1 of
the MB Circular
b. C ompliance with Clause 11.2.10 of December 31,
July 03, 2026
the MB Circular 2026
Compliance with net worth
c. January 02,
requirements under Regulation 7 of March 31, 2027
2027
the MB Regulations – Phase I
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S. Existing
Requirement New Timeline
no. Timeline
Compliance with net worth
d. January 02,
requirements under Regulation 7 of March 31, 2028
2028
the MB Regulations – Phase II
Compliance with liquid net worth
e. January 02,
requirements under Regulation 7A March 31, 2027
2027
of the MB Regulations – Phase I
Compliance with liquid net worth
f. January 02,
requirements under Regulation 7A March 31, 2028
2028
of the MB Regulations – Phase II
Intimation to SEBI regarding
g. January 02,
categorisation as Category I or March 31, 2027
2027
Category II Merchant Banker
7. All other provisions of the MB Circular dated January 02, 2026 shall remain unchanged
and shall be complied by Merchant Bankers.
8. This circular is issued in exercise of powers conferred under Section 11(1) of the
Securities and Exchange Board of India Act, 1992 read with Regulation 45 of the SEBI
(Merchant Bankers) Regulations, 1992.
9. This circular is available on the SEBI website at www.sebi.gov.in under the category
“Legal” and under the drop-down “Circulars”.
10. This circular is issued with the approval of the competent authority.
Yours faithfully,
Vimal Bhatter
Deputy General Manager
Corporation Finance Department
Tel no.: 022-40459386/022-26449386
Email ID: vimalb@sebi.gov.in
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