Sebi extends timeline for Angel Funds to disclose allocation methodology

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The Securities and Exchange Board of India (Sebi) has granted additional time to Angel Funds registered under the Alternative Investment Funds (AIF) Regulations to comply with the disclosure requirements related to investment allocation methodology.

In a circular issued on Wednesday the market regulator extended the deadline for existing Angel Funds to define and disclose their investment allocation methodology in their Private Placement Memorandum (PPM) from October 15, 2025, to January 31, 2026.

The move follows representations from the AIF industry seeking more time to implement the revised framework effectively. Sebi stated that the relaxation aims to ensure ease of compliance for the industry.

Sebi in the latest circular said, “Based on representation from the AIF industry requesting additional time to meet this requirement, it has been decided to extend the said timeline to January 31, 2026, for ease of compliance. Accordingly, allocation of any investment made by existing Angel Funds post January 31, 2026, shall be in accordance with the defined allocation methodology disclosed in their PPMs."

As per Sebi’s earlier circular issued on September 10, 2025, Angel Funds were required to specify a clear and transparent methodology for allocating investments among participating angel investors who approve such investments. Originally, any investments made after October 15, 2025, were to follow this defined methodology.

Following the extension, the revised compliance date now stands at January 31, 2026, meaning any investments made by existing Angel Funds after this date must adhere to the disclosed allocation methodology.

Sebi said all other outlines in the circular dated September 10, 2025 on ‘Revised regulatory framework for Angel Funds under AIF Regulations’ will remain unchanged.

Commenting on the move, President of IVCA, Rajat Tandon said, “This extension underscores SEBI’s commitment to a pragmatic regulatory transition — one that not only strengthens transparency and investor protection but also acknowledges the operational challenges faced by angel fund managers. It gives the ecosystem the necessary time to adapt processes, align investor communication, and embed governance standards in a sustainable manner. We at IVCA, welcome this as a constructive step forward that will help Angel Funds integrate the new framework comprehensively and with confidence, while continuing to play a pivotal role in nurturing India’s start-up economy.”