SEBI has replaced US dollar-denominated fees for Foreign Portfolio Investors with a new rupee-based structure. This shift aims to simplify accounting and reduce manual invoicing delays for overseas investors. The changes, which set Category-I fees at ₹2.3 lakh, will become mandatory in six months.
The Securities and Exchange Board of India (SEBI) has announced a significant change to how Foreign Portfolio Investors (FPIs) pay their registration fees. In a regulatory notification, the market watchdog confirmed it is moving away from the existing US dollar-denominated fee system to a rupee-based model. This move is designed to simplify operations, as the previous system often required complex manual accounting and created delays in financial reporting.
New Fee Structure and Timeline
Under the updated rules, the registration fee for Category-I FPIs is now set at ₹2.3 lakh, replacing the previous $2,500 charge. For Category-II FPIs, the fee will be ₹23,000, up from the earlier $250. Additionally, the application fee for specific regulatory relaxations or exemptions has been adjusted to ₹90,000, replacing the former $1,000 requirement. These changes are set to take effect six months from the July 3 notification date, giving foreign investors and their intermediaries time to adjust their internal processes.
Enhancing Operational Efficiency
Beyond just changing the currency of payment, SEBI is updating the Common Application Form to include mandatory details like date of birth or the date of incorporation. This adjustment is intended to make the allotment of Permanent Account Numbers (PAN) smoother and faster. Furthermore, Designated Depository Participants (DDPs)—the banks that handle registration for FPIs—must now transfer the registration fees to SEBI within five working days of granting the license.
This shift addresses long-standing complaints regarding the difficulty of managing foreign currency payments for Indian regulatory compliance. By standardizing these payments in rupees, the process becomes more transparent and less prone to the fluctuations and administrative hurdles associated with cross-border invoicing. For the fiscal year 2025-26, SEBI recorded collections of approximately $12.98 million from FPI and Foreign Venture Capital Investor (FVCI) fees, highlighting the importance of a well-functioning payment ecosystem.
Investors and market participants should track how these changes impact the onboarding time for new FPIs over the next six months. The move is part of a broader push by the regulator to digitize and simplify market access for global investors while ensuring that financial reporting remains accurate and timely.