To ease the cost and compliance burden on the issuer of securities, markets regulator Sebi has done away with the requirement of 1 per cent security deposits with exchanges for public issuance of debt securities. The decision comes after the board of Sebi approved a proposal in this regard in its meeting last month. Currently, 1 per cent of the amount offered for subscription to the public is required to be deposited with the stock exchanges so that complaints relating to refund of application money, allotment of securities and dispatch of certificates among others can be resolved speedily.
In three separate notifications dated October 9, Sebi has done away with the requirement of 1 per cent security deposit in the cases of public issues of debt securities, non-convertible redeemable preference shares and securitised debt instruments. The move is expected to ease the cost and compliance burden on the issuers.