“NSE has always played a pivotal role in capital formation for the country. We are working towards the launch of the Social Stock Exchange as a segment on NSE," NSE Managing Director and CEO Ashish Kumar Chauhan said in a statement.
"We believe this platform will immensely benefit the social enterprises contributing to the Sustainable Development Goals," he added.
The government has already notified new security, “Zero Coupon Zero Principal (ZCZP)”, under the Securities Contracts (Regulation) Act, 1956.
The new instrument ZCZP can be publicly or privately issued by Not for Profit (NPO) upon registering with the Social Stock Exchange segment of NSE to raise funds subject to fulfilment of eligibility criteria.
The regulations have currently prescribed the minimum issue size of Rs 1 crore and minimum application size for subscriptions at Rs 2 lakhs. Subscription to the ZCZP would be like a philanthropic donation.
In her 2019-20 Budget speech, Finance Minister Nirmala Sitharaman had proposed the creation of a Social Stock Exchange, under the regulatory ambit of the SEBI for listing social enterprises and voluntary organisations working for the realisation of a social welfare objective, so that they can raise capital as equity, debt or as units like a mutual fund.
