Fintech Frontline: Legal And Market Intelligence From India (Twelfth Edition 2026)

Over the first quarter of 2026, India’s fintech regulatory landscape witnessed significant developments, with regulators continuing their focus on strengthening market infrastructure, enhancing investor protection, and modernising regulatory frameworks. The Securities and Exchange Board of India (“SEBI”) remained at the forefront of these reforms by notifying the Securities and Exchange Board of India (Mutual Funds) Regulations, 2026, introducing a comprehensive new framework for mutual funds, and the SEBI (Stock Brokers) Regulations, 2026, which consolidated and streamlined the regulatory regime governing stock brokers. SEBI also introduced the SWAGAT-FI framework to simplify registration and market access processes for foreign investors, while continuing its broader efforts to improve ease of doing business and regulatory efficiency.

The Reserve Bank of India (“RBI”) continued its agenda of regulatory consolidation and strengthening its existing frameworks. In addition to notifying the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, and consolidating several circulars into comprehensive master directions, the RBI also issued amendment directions to its risk weighting framework for infrastructure project exposures, providing calibrated relief for regulated entities and supporting credit flow towards the infrastructure sector.

This edition of our fintech newsletter explores the key industry developments, market trends, funding activity, and regulatory updates that shaped the Indian fintech landscape during the first quarter of 2026.

SEBI Issues Consultation Paper on Norms for Sharing and Usage of Price Data for Educational Purposes (Link)

SEBI, through a consultation paper dated January 06, 2026, invited public comments on proposed norms governing the sharing and usage of securities market price data for educational and investor awareness activities. The consultation paper proposes introducing a uniform time lag of 30 (thirty) days for both sharing and usage of price data for educational and awareness purposes. The proposal sought to replace the existing framework which prescribes different time lags for sharing and usage of price data, with the objective of preventing misuse of market data while ensuring that educational content remains relevant. 

SEBI Issues Consultation Paper on Simplification of Client On-Boarding and Rationalisation of Risk Management Framework at KYC Registration Agencies (Link)

SEBI through a consultation paper dated January 16, 2026, invited public comments on a proposal aimed at simplifying client on-boarding processes and rationalising the risk management framework applicable to Know Your Customer (“KYC”) Registration Agencies (“KRAs”). The consultation paper proposed measures to streamline the client on-boarding process and reduce duplication in KYC requirements across intermediaries. The proposal, inter alia, included centralisation of supplementary client information at the KRA level to enable seamless sharing of KYC information / updates across intermediaries, limited simplification of documentation requirements, introduction of defined timelines for updating or delinking KYC records, and strengthening of risk management and data governance practices at KRAs. 

Proposed Amendments to ”Fit and Proper Person” Criteria for Intermediaries (Link)

SEBI has issued a consultation paper on February 04, 2026 proposing amendments to Schedule II of the SEBI (Intermediaries) Regulations, 2008 relating to the “fit and proper person” criteria applicable to market intermediaries. The proposals, inter alia, seek to recalibrate disqualification triggers linked to regulatory and criminal proceedings, introduce greater regulatory discretion for holistic assessment of integrity and reputation standards, and clarify governance-related considerations for evaluating promoters, control persons and key managerial personnel. 

Mandatory Disclosure of Registration Details on Social Media Platforms (Link)

SEBI has issued a circular to enhance the Ease of Doing Investment   by mandating the disclosure of registered names and registration numbers by SEBI-regulated entities and their agents on social media platforms . These provisions aim to help investors distinguish authentic market content from that of unregistered persons. Effective May 1, 2026, regulated entities including stock brokers, investment advisers, and mutual funds must ensure that any content uploaded by them or their agents clearly displays their official SEBI registration details at the beginning of the post or via a prominent web link on their social media home page. 

SEBI Introduces SWAGAT-FI Framework for Foreign Portfolio Investors and Foreign Venture Capital Investors (Link)

SEBI through a circular dated January 16, 2026, has introduced the Single Window Automatic and Generalised Access for Trusted Foreign Investors (“SWAGAT-FI”) framework for Foreign Portfolio Investors (“FPIs”) and Foreign Venture Capital Investors (“FVCIs”). The framework seeks to streamline the registration and compliance process for certain categories of foreign investors by enabling a single-window mechanism for market access. The framework, inter alia, permits eligible investors to obtain FPI and FVCI registrations through a unified application process, thereby eliminating duplication of documentation and compliance requirements. The circular amends the existing operational guidelines governing FPIs and FVCIs. The provisions of the framework will come into effect from June 01, 2026.

SEBI issues informal guidance on client-level segregation requirements (Link)

Based on the informal guidance issued by SEBI in response to an application by Sanguine Wealth Advisers LLP (“Sanguine”), the regulatory position on client-level segregation under Regulation 22 of the SEBI (Investment Advisers) Regulations, 2013 ("IA Regulations"), has been reaffirmed in a strict and literal manner. Under Regulation 22(3) of the IA Regulations, non-individual investment advisers are mandated to ensure client-level segregation at the group level between advisory and distribution activities. This is also supplemented by the Master Circular for Investment Advisers dated February 6, 2026. The regulatory framework clearly contemplates that a client must be categorised exclusively as either (i) an advisory client (with no distribution-related consideration received at the group level); or (ii) a distribution client (with no advisory fee charged). The underlying objective of this regime is to eliminate conflicts of interest and ensure transparency in the provision of investment advice.

In the factual context presented by Sanguine, the issue arose in relation to whether existing distribution clients could transition to advisory services without liquidating their existing investments, even if this would temporarily result in both advisory fees and embedded distribution commissions being applicable. SEBI, in its interpretive response, has taken a strict view of segregation, emphasising that at no point can a client simultaneously receive both advisory and distribution services from the same group entity. While the framework permits clients to continue holding legacy investments (and expressly prohibits forcing liquidation of such holdings), this relaxation does not dilute the core requirement of client-level segregation.

SEBI’s interpretation effectively limits the flexibility of Investment Advisers (“IAs”) in facilitating such business transitions, whereby even a temporary overlap arising from legacy investments and fee structures is not contemplated as a permissible exception. This informal guidance reasserts SEBI’s stance on activities that may be undertaken by non-individual IAs pursuant to their limited registration. In practice, this mandate will likely present several operational and commercial challenges for industry participants, complicating client migration between services and potential revenue disruption, as IAs may have to forgo distribution commissions or advisory fees during transition phases.

NSDL Issues Guidance on SOP for Handling Cyber Security Incidents (Link)

The National Securities Depository Limited (“NSDL”), through a circular dated January 05, 2026, has issued guidance to participants on the preparation of a Standard Operating Procedure (“SOP”) for handling cyber security incidents. The circular has been issued in reference to SEBI’s cyber security and cyber resilience framework. The circular provides an indicative scope for preparation of the SOP, with a view to ensuring preparedness, timely detection, response, and reporting of cyber security incidents. Participants are required to establish appropriate mechanisms for reporting such incidents to NSDL through prescribed channels, in accordance with applicable regulatory requirements. 

RBI Mandates Submission of PPI Returns through Centralised Information Management System (Link)

RBI, through a circular dated January 01, 2026, has directed all Prepaid Payment Instrument (“PPI”) issuers to submit certain regulatory returns through the Centralised Information Management System (“CIMS”). The circular requires submission of the PPI Statistics (R100) return on a monthly basis and the PPI Customer Grievances (R360) return on a quarterly basis, commencing from the December 2025 reporting period. Monthly returns are to be submitted by the 7^th of the succeeding month, and the quarterly returns are to be submitted by the 10^th of the succeeding month after completion of quarter. Non-compliance may attract penal action under the Payment and Settlement Systems Act, 2007.

RBI Recognises FEDAI As Self-Regulatory Organisation For Authorised Dealers (Link)

The RBI has recognised the Foreign Exchange Dealers’ Association of India (“FEDAI”) as a Self-Regulatory Organisation (“SRO”) for all Authorised Dealers under the Omnibus Framework for SROs for Regulated Entities issued in March 2024. FEDAI has been granted a one-year transition period to align its functioning and governance framework with the requirements of the Omnibus SRO framework. It is also required to take necessary steps to expand its membership to cover all categories of Authorised Dealers.

IRDAI Directs Adoption of 1600-Series Numbers for Service and Transactional Voice Calls (Link)

The Insurance Regulatory and Development Authority of India (“IRDAI”), through a circular issued on January 6, 2026, has directed insurers and insurance intermediaries to adopt the 1600-series numbering system for all service and transactional voice calls made to consumers, pursuant to a direction issued by the Telecom Regulatory Authority of India (“TRAI”) dated December 16, 2025. The circular required entities to complete adoption of the 1600-series numbers by February 15, 2026. It further provides that no such calls may be initiated from any other number after the specified date and requires submission of status reports as prescribed by TRAI. 

IFSCA Issues Consultation Paper on Guidelines for Algorithmic Trading on Stock Exchanges In IFSC (Link)

The International Financial Services Centres Authority (“IFSCA”),, through a consultation paper dated January 21, 2026, has invited public comments on the proposed guidelines for algorithmic trading on stock exchanges operating in International Financial Services Centre (“IFSC”). The consultation paper proposes a regulatory framework to govern algorithmic trading with the objective of promoting transparency, accountability, and effective risk management. The proposals, inter alia, include tagging of algorithmic trading orders to enable audit trails, mandatory approval and disclosure of trading algorithms to stock exchanges, implementation of risk control mechanisms and surveillance systems, and periodic system audits for market participants providing algorithmic trading facilities.

IFSCA Publishes Public Comments on Review of Global In-House Centres Framework (Link)

The IFSCA through a consultation paper dated January 12, 2026, has invited public comments on the review of the regulatory framework governing Global In-House Centres (“GICs”) operating in IFSC. The consultation paper seeks stakeholder feedback on various aspects of the existing regulatory framework applicable to GICs in IFSCs, including operational requirements, permissible activities, and governance and reporting standards.

IFSCA mandates standardized Net Worth Certification and Audit Compliance for Broker-Dealers and Global Access Providers in the IFSC^[i](Link)

IFSCA, on February 12, 2026, issued the Format of Net Worth Certificate and Checklist for conducting Audit of GAPs (“Circular”) on February 12, 2026. The Circular is applicable to all broker dealers and Global Access Providers (“GAPs”) in the IFSC. The Circular provides standardized reporting formats and aims to ensure compliance with minimum net worth requirements and operational standards to maintain market integrity. The Circular required GAPs to submit a net worth certificate, undergo an independent audit to ensure compliance with Capital Market Intermediaries Regulations, 2025, mandated robust KYC, AML and CFT systems, secure data storage and outsourcing arrangements and adherence to strict code of conduct and advertisement standards supported by declarations from key managerial personnel.

The Circular also applies to broker dealers accessing global markets on a proprietary basis through GAPs. All regulated entities must ensure timely submission of quarterly reports and accurate fee payments to the IFSCA  to avoid regulatory action.

IFSCA introduces ease of doing business measures. (iii) (Link) (Link)

IFSCA issued a circular on the Unified Registration for multiple Capital Market Activities (“Circular”) on February 13, 2026 applicable to all entities seeking registration for multiple capital market activities in the IFSC. The Circular introduces a reform to enhance the ease of doing business and aims to establish a streamlined registration process that saves time for applicants by utilizing a single window system. The Circular requires entities to now utilise the Master Key framework which enables an entity to apply for multiple capital market activities through a single application form, submit applications via the Single Window IT System Portal , and obtain a common certificate of registration, which will contain an exhaustive list of all the approved registrations for that specific entity.

Additionally, in furtherance of these ease of doing business measures, IFSCA has amended the IFSCA (Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines, 2022 to now permit regulated entities to use OTP-based Aadhaar e-KYC authentication as a recognized customer due diligence mechanism.

Government of India issues Press Note No. 1 (2026 Series) to liberalize FDI Limits in the Insurance Sector ^[iv] (Link)

The Government of India, with the aim of review and liberalize the foreign investment landscape, has issued Press Note No. 1 (2026 Series) on February 09, 2026, introducing the following amendments (“Amendments”) to the Consolidated Foreign Direct Investment (“FDI”) Policy:

• The Government has permitted up to 100% (one hundred percent) foreign direct investment (“FDI”) in insurance companies under the automatic route, subject to compliance with the Insurance Act, 1938.
• A specific provision has been introduced to allow foreign investment in LIC up to 20% (twenty percent) under the automatic route. 
• The policy reaffirms that 100% (one hundred percent) FDI is permitted under the automatic route for insurance intermediaries, including brokers, consultants, third-party administrators, and surveyors subject to adherence to IRDAI regulatory requirements.
• For insurance companies with foreign investment exceeding 49% (forty nine percent), the majority of directors, key managerial personnel, and at least one among the chairperson of the board, managing director, or CEO must be resident Indian citizens.

The amendments stipulate that any FDI is subject to the applicable laws and regulations regarding pricing, reporting, and documentation. The new decisions will formally take effect from the date of the corresponding notification. 

CDSL introduces significant operational updates ^[v][vi](Link) (Link)

Central Depository Services (India) Limited (“CDSL”) has introduced two significant operational updates aimed at streamlining transaction and settlement processes for participants.

• The ‘Stamp Duty Payment Indicator’ facility has been launched. This new feature allows Depository Participants (“DPs”) to specify at the time of transaction whether the applicable stamp duty should be debited from their own virtual bank account or the client’s. This shifts away from the current system where the initiating entity is automatically debited, offering greater flexibility in managing tax liabilities.
• Effective March 21, 2026, Clearing Members (in both debt and equity segments) will no longer be required to maintain separate Early Pay-In  accounts with the clearing corporation for CDSL.

Introduction of Penalty Framework for Crypto-Asset Disclosures (Link)

The Budget proposes introduction of a penalty framework for non-furnishing and inaccurate reporting of crypto-asset transaction disclosures by prescribed reporting entities, including daily penalties for failure to submit required statements and monetary penalties for furnishing incorrect information, with the objective of strengthening compliance and oversight of digital asset transactions.

MeitY proposes amendments to make compliance with advisories and clarifications binding on intermediaries (Link) (Link)

In deviation from the established status quo, Ministry of Electronics and Information Technology of India (“MeitY”), vide notification dated March 30, 2026, has proposed a significant shift in the regulatory framework governing intermediaries under the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 (“IT Rules”). Pursuant to the aforementioned notice, MeitY has proposed to amend the IT Rules to incorporate compliance with MeitY-issued advisories, clarifications, directions, standard operating procedures , and guidelines into the due diligence requirements applicable to intermediaries.

The proposed amendments to the IT Rules would make compliance with MeitY-issued advisories, directions, clarifications and similar instruments a condition for retaining safe harbour protection. 

Any such instrument issued by MeitY must meet certain minimum legal standards to be enforceable. Specifically, it must be issued in writing, clearly identify its statutory basis, define its scope and applicability to relevant intermediaries, and set out the corresponding compliance requirements, while remaining consistent with the parent legislation and the applicable rules.

Advisories are traditionally flexible in nature and may not always possess the clarity or procedural safeguards associated with formally issued regulations. Intermediaries will also be required to track, interpret, and implement a potentially large volume of MeitY issued instruments in real time, which could be burdensome from a compliance perspective.

The proposed amendment, if implemented, materially increases regulatory risk for fintechs by linking compliance with such advisories directly to the retention of safe harbour protection. Any failure to comply, even with evolving or informal guidance, could expose fintech platforms to liability for third-party content or transactions.

EU-India FTA concluded on 27 January 2026 (Link)

The European Union (“EU”)-India Free Trade Agreement (“FTA”) was concluded on January 27, 2026, marking the largest trade deal ever concluded by either side and making the EU India's 22^nd FTA partner. For fintechs and financial services firms, the agreement opens several significant opportunities such as:

• Indian financial institutions and fintech companies gain access to EU clearing and payment systems under national treatment conditions, with a more transparent authorization process for regulatory approvals across all 27 (twenty seven) member states.
• The FTA mandates interoperability between Indian and EU digital payment infrastructure, covering real-time cross-border remittances and merchant payments.
• A dedicated framework covering SupTech, RegTech, and CBDC collaboration is established, with joint initiatives on AI in financial services - creating partnership and revenue opportunities for Indian RegTech and AI-focused fintech firms.
• The agreement mandates legal validity of electronic contracts, promotes mutual recognition of e-signatures and e-timestamps - reducing friction and paperwork for cross-border loan documentation, insurance, and digital onboarding workflows.

Amazon Pay Rolls Out Fixed Deposits To Expand Financial Services (Link)

Amazon Pay has launched a fixed deposit (“FD”) investment service in India, allowing users to invest directly through the Amazon Pay interface within the Amazon app. The offering enables customers to open FDs starting from INR 1,000 (Indian Rupees one thousand) without the need to open a separate savings account with partner institutions. The service is being offered in partnership with multiple banks and Non-Banking Financial Company (“NBFCs”), including Shriram Finance, Bajaj Finance, Shivalik Small Finance Bank, Suryoday Small Finance Bank, South Indian Bank, slice, and Utkarsh Small Finance Bank, with interest rates of up to around 8% (eight percent) per annum. 

Pine Labs To Build Acquiring Infrastructure For UAE-Based Wio Bank (Link)

Pine Labs has entered into a partnership with Wio Bank, a UAE-based digital bank, to build a modern merchant acquiring infrastructure for the bank. Under the arrangement, Wio Bank will deploy Pine Labs’ issuing and acquiring platform, Credit+, to support its core payment acquiring operations. The cloud-native platform will enable faster merchant onboarding, real-time settlement capabilities, and multi-mode payment acceptance at scale. The collaboration is expected to help Wio Bank scale payment volumes and strengthen compliance while expanding Pine Labs’ international payments infrastructure presence in the Middle East.

SEBI Clears Kissht’s INR 1,000 Cr IPO (Link)

Digital lending platform ‘Kissht’ has received approval from SEBI to proceed with its initial public offering. The regulator issued its observations to the company’s parent entity, OnEMI Technology Solutions, which effectively allows the company to move ahead with the public issue. Kissht had filed its draft red herring prospectus in August 2025 to raise up to INR 1,000 ( Indian Rupees one thousand) crore through a fresh issue of shares, along with an offer-for-sale component by existing investors.

Apple Pay Prepares For India Launch Amid Regulatory Approvals (Link)

Apple Inc. is reportedly preparing to launch its digital payments service, Apple Pay, in India after more than a decade since its global debut, with regulatory approvals currently underway. The company is in discussions with Indian regulators, banks, and global card networks to enable the rollout of the service in the country. The launch is expected to be phased, initially enabling card-based contactless payments through Apple Wallet, allowing users to store credit and debit cards and make tap-to-pay transactions using Apple devices. Support for UPI may be considered in later stages, as it would require additional regulatory approvals and integration with India’s payments infrastructure.

RBI Proposes Linking Digital Currencies Of BRICS Member Countries (Link)

The RBI has reportedly proposed linking the central bank digital currencies (“CBDCs”) of BRICS member nations including Brazil, Russia, India, China, and South Africa to facilitate smoother cross-border payments. The proposal aims to enable faster and more efficient payments for trade and travel transactions among the member countries. The proposal may be discussed at the 2026 BRICS summit, which India is set to host. The initiative builds on earlier discussions among BRICS countries on improving interoperability between their payment systems, although the member states remain at different stages of CBDC development and pilot implementation.

RBI Governor Calls For Near Real-Time, Tech-Driven Supervision To Address Digital Banking Risks (Link)

RBI Governor Sanjay Malhotra (“Governer”), in a speech at the Third Annual Global Conference of the College of Supervisors in Mumbai, emphasised the need for technology-driven, near real-time supervision of the financial system to address emerging risks from rapid digitalisation. The Governor highlighted that traditional periodic and on-site supervision models are no longer sufficient for a fast-moving digital financial ecosystem. He pointed to RBI’s increasing use of supervisory technology and data platforms such as the CIMS and the DAKSH monitoring system, and stressed the need for stronger analytics and supervisory dashboards to enable early identification of risks.

Income Tax Department Flags Risks Associated With Cryptocurrencies (Link)

The Income Tax Department has raised concerns over the risks posed by virtual digital assets  such as cryptocurrencies, highlighting challenges in monitoring and enforcing tax compliance. In a presentation to the Parliamentary Standing Committee on Finance, officials noted that the anonymous, borderless, and near-instant nature of crypto transactions allows funds to move without regulated financial intermediaries. The department also flagged difficulties in detecting taxable income due to the use of offshore exchanges, private wallets, and decentralised platforms, which obscure ownership and transaction trails. Authorities added that jurisdictional limitations and limited cross-border information sharing make it difficult to verify transactions and recover tax dues linked to crypto activity.

Indian Crypto Startups Brace For Stricter KYC Scrutiny (Link)

Indian cryptocurrency exchanges and startups are facing tighter KYC requirements after the Financial Intelligence Unit  issued updated compliance guidelines. The measures are aimed at strengthening oversight of the virtual digital assets sector and addressing concerns around illicit financial activity. The revised requirements include enhanced onboarding checks such as live selfie verification, geo-tagging during registration, and periodic re-verification of high-risk users, which could increase compliance costs for crypto platforms operating in India. 

India and Sweden forge Strategic Partnership to establish SITAC for Artificial Intelligence and Digital Innovation^[vii] (Link)

The IndiaAI Mission and Business Sweden have entered into a Statement of Intent (“SoI”) to establish the Sweden–India Technology and Artificial Intelligence Corridor (“SITAC”) on February 25, 2026. The partnership aims to strengthen bilateral artificial intelligence (“AI”) collaboration, promote trade and investment, and drive responsible, scalable digital innovation across both nations.

The SoI provides a structured framework for the development, application, and deployment of AI solutions, with an emphasis on real-world industrial and societal outcomes. The collaboration will promote exchange through conferences, seminars and workshops, enable field visits to innovation hubs, support joint innovation and investment opportunities for startups and research institutions and encourage bilateral AI deployment by combining India’s strong talent base with Sweden’s expertise in industrial innovation and advanced research and development.

Following the signing, both nations are expected to focus on creating new business opportunities through inclusive and scalable digital innovations.

NPCI International Payments Limited expands UPI footprint to Malaysia through strategic partnership with PayNet^[viii] (Link)

National Payments Corporation of India (“NPCI”) International Payments Limited (“NIPL”), the international arm of NPCI, is expanding its global footprint into Malaysia through a strategic partnership with PayNet, the national payments network of Malaysia. This collaboration will enable Indian travellers to make seamless UPI payments across Malaysia using QR codes.

The service will allow users to perform cross-border transactions directly from their existing UPI-enabled apps, eliminating the need for currency exchange or international cards. This expansion is part of NIPL’s broader global strategy, which has recently included successful UPI launches in countries like Singapore, the UAE, Mauritius, and several European nations.

India AI Governance Guidelines and Launch of FiMI Model (Link)(Link)

The India AI Impact Summit 2026 featured the unveiling of the India AI Governance Guidelines, a comprehensive, principle-based framework designed by the Press Information Bureau to promote safe and responsible AI deployment through expanded compute access, India-specific risk assessment mechanisms, and a review of existing legal frameworks like the Information Tecnology Act, 2000 (“IT Act”) to address regulatory gaps. 

Alongside these regulatory developments, the NPCI announced FiMI (Finance Model for India), a specialized Small Language Model developed for the Indian payment ecosystem to enhance grievance resolution via the UPI Help Assistant pilot. 

Supported by a collaboration with NVIDIA, NPCI aims to evolve FiMI into a foundational, scalable AI layer that aligns with India’s data sovereignty requirements while establishing new institutional mechanisms like the AI Governance Group to oversee a whole-of-government approach to technology. 

NPCI & NVIDIA Collaborate to Develop Sovereign AI Foundation Models for Payments (Link)

The NPCI announced its collaboration with NVIDIA to scale and advance sovereign AI model capabilities purpose-built for India's payments ecosystem.

The initiative will utilise NVIDIA Nemotron to create a payments-native AI foundation model aligned with India's regulatory and data sovereignty requirements, building on NPCI's FiMI (Financial Model for India) and the UPI Help Assistant pilot initiative.

The collaboration is expected to support innovation in trust frameworks, grievance redressal processes, and operational intelligence across the payment ecosystem. 

MoneyView files Draft Red Herring Prospectus with SEBI for IPO (Link)

Accel-backed fintech lending startup MoneyView Limited (formerly known as MoneyView Private Limited) (“MoneyView”) has filed its Draft Red Herring Prospectus with SEBI for an Initial Public Offering (“IPO”). The company proposes to raise INR 1,500 (Indian Rupees One Thousand Five Hundred) crores through fresh issue of shares, while existing investors including promoters Sanjay and Puneet Agarwal, Accel, Apis Partners and Ribbit Capital will offer 136 (One Hundred Thirty Six) million shares for sale. MoneyView plans to deploy INR 450 ( Indian Rupees Four Hundred Fifty) crores to capitalise its in-house NBFC and INR 650 (Indian Rupees Six Hundred Fifty) crores to support loan disbursals through partner lenders under the first loss default guarantee programme. 

We have set out in the table below some of the major deals in the first quarter of 2026:

RBI Issues Amendment Directions on Risk Weighting Framework for NBFC Exposure to Infrastructure Projects (Link)

The RBI has issued the RBI (Non-Banking Financial Companies – Prudential Norms on Capital Adequacy) Amendment Directions, 2026 (“Capital Adequacy Amendment Directions”) and the RBI (Non-Banking Financial Companies – Concentration Risk Management) Amendment Directions, 2026 (“Concentration Risk Amendment Directions”) on January 1, 2026. These directions have been issued pursuant to the feedback received on draft RBI (Non-Banking Financial Company – Scale Based Regulation) Amendment Directions, 2025. 

The Capital Adequacy Amendment Directions introduce a repayment-linked tiered risk weight framework for loans extended to “High-quality infrastructure projects”. This concept was introduced under the Concentration Risk Amendment Directions, which set out the criteria for a project to qualify as “high-quality”. Accordingly, the applicable risk weights vary based on the extent of repayment of the sanctioned project debt.

As per Capital Adequacy Amendment Directions, where the borrower has repaid at least 2% (two percent) of the sanctioned project debt, a risk weight of 75% (seventy-five percent) shall apply. Where the borrower has repaid at least 5% (five percent) of the sanctioned project debt, the applicable risk weight is further reduced to 50% (fifty percent). In the event a project that previously qualified as a high-quality infrastructure project subsequently fails to meet the prescribed conditions, the exposure shall revert to the higher risk weights applicable under the extant prudential norms. 

The amended directions shall be applicable from April 1, 2026, or from an earlier date when adopted by a NBFC in entirety. NBFCs may, however, continue to maintain extant risk weights for exposures that attract a lower risk weight under the current guidelines but would be subject to higher risk weights under the revised framework, until the next review or renewal or March 31, 2027, whichever is earlier.

Proposed Registration Exemptions for Small NBFCs Without Public Funds (Link) (Link)

RBI has issued the RBI Non-Banking Financial Companies – Registration, Exemptions and Framework for Scale Based Regulation) Amendment Directions, 2026 (“Amendment Directions”) proposing that NBFCs not availing public funds and not having customer interface, with an asset size of less than INR 1000 (Indian Rupees one thousand) crore, will be exempted from the registration requirement with the RBI. The Amendment Directions also include procedure for deregistration or conversion of existing NBFCs not availing public funds and not having customer interface.

Draft Revision of Master Direction for Credit Derivatives (Link)

RBI has, vide a press release dated February 06, 2026, released a draft revised Master Direction – RBI (Credit Derivatives) Directions, 2022 for public consultation. The draft framework, inter alia, proposes enabling derivatives on credit indices and total return swaps on corporate bonds, consolidates provisions relating to credit derivatives, and aims to improve credit risk management and liquidity in the corporate bond market. 

Draft Framework for Marketing and Sale of Financial Products by Regulated Entities (Link)

RBI has released draft amendment directions to establish a comprehensive regulatory framework governing the advertising, marketing and sale of financial products and services by banks, NBFCs and other regulated entities. 

The proposed framework expands existing suitability and appropriateness norms and addresses issues such as activities of direct sales/marketing agents, prevention of mis-selling and use of dark patterns in customer interfaces. 

Prudential Norms for NBFC Loan Portfolios Under Default Loss Guarantee Arrangements (Link)

RBI has issued amendments to the RBI (Non-Banking Financial Companies – Income Recognition, Asset Classification and Provisioning) Directions, 2025. 

The amendment introduces prudential norms for loan portfolios covered by Default Loss Guarantee (“DLG”) arrangements, which were earlier permitted in limited contexts such as digital lending and co-lending. 

The amendments, inter alia, provide that NBFCs may consider DLG arrangements while determining provisions under the Expected Credit Loss framework, subject to compliance with applicable Indian Accounting Standards and the condition that the DLG is integral to the contractual terms of the loan and not separately recognised.

NBFCs shall recompute Expected Credit Loss provisioning upon each invocation of the DLG, to reflect the reduced cover.

RBI imposes monetary penalty on various fintechs for non-compliances under directions issued under the Payment and Settlement Systems Act, 2007 (Link) (Link)

RBI has, by an order dated March 9, 2026, imposed a monetary penalty of INR 3,10,000 (Indian Rupees three lakh ten thousand) on Cashfree Payments India Private Limited for non-compliance with certain directions issued by RBI on 'Guidelines on Regulation of Payment Aggregators  and Payment Gateways. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 30(1) read with section 26(6) of the Payment and Settlement Systems Act, 2007. The enforcement action follows a statutory inspection conducted by RBI with reference to Cashfree's operations for the period from April 2024 to June 2025, which revealed supervisory findings of non-compliance with RBI directions. Based on these findings, RBI issued a show cause notice to Cashfree advising it to demonstrate why penalty should not be imposed for its failure to comply with the said provisions. After considering Cashfree's reply to the notice and additional submissions made by the company, RBI found, inter alia, that the charge against Cashfree for making certain impermissible debit from the escrow account was sustained, warranting imposition of monetary penalty. The escrow account mechanism is a critical safeguard in the payment aggregator framework, designed to protect customer funds by ensuring proper segregation and utilization of merchant settlement funds. RBI has clarified that this action is based on deficiencies in statutory and regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the company with its customers. Further, the imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the company.

RBI releases its Payments Vision for 2028 (Link)

RBI released its Payments Vision 2028 (“Vision”), which sets out its roadmap for the next 3 (three) years, focusing on user empowerment, strengthening safeguards against fraud, enhancing efficiency of cross-border payment frameworks, and promoting ease of doing business, among other things.

A key initiative highlighted under the 2028 Vision is the introduction of a shared liability framework for unauthorised digital payment transactions, under which both the issuing bank and the beneficiary bank would bear responsibility in cases of fraud. The Vision further contemplates product and infrastructure innovation, including the potential introduction of electronic cheques (e-cheques) and the development of an open card ecosystem to promote competition and interoperability in card-based payments. The RBI also aims to expand regulatory oversight to cover a wider range of digital payment participants and platforms, ensuring that emerging fintech models are brought within its supervision.

From a consumer standpoint, the RBI proposes several initiatives to reduce friction and enhance user experience. These include enabling bank account portability, allowing customers to retain account identifiers while switching banks, and improving the efficiency and transparency of cross-border payment systems to reduce costs and settlement delays. Additionally, the RBI is working towards strengthening data-driven supervision and fraud monitoring through initiatives such as the development of a Digital Payments Intelligence Platform which would leverage advanced technologies to detect and mitigate risks in real time. 

The Vision reflects RBI’s continued emphasis on enhancing the efficiency, security, and accessibility of payment systems, while ensuring that the regulatory framework evolves with innovations in the fintech ecosystem.

International Financial Services Centres Authority issues Directions on obtaining ISINs from recognised depositories to streamline Securities Dematerialisation in the International Financial Services Centre^[xi](Link)

The IFSCA in its efforts to take various measures to promote ease of doing business, deepen market infrastructure, and strengthen the regulatory ecosystem in the IFSC has issued directions dated February 06, 2026 on obtaining International Securities Identification Numbers (“ISINs”) from a recognised depository in the IFSC (“Directions”). The Directions require IFSC entities to obtain ISINs through an IFSC-recognised depository for dematerialisation of securities. The Directions also prescribe responsibilities for the recognised depository to facilitate a standardised transition process, issue guidance to market participants and submit a compliance report to the IFSCA upon completion of the migration process.

IFSCA issues Draft Financial Advisers Regulations, 2026 to strengthen Investor Protection and Advisory Standards^[xii](Link)

IFSCA has published its consultation paper on the draft IFSCA (IFSC Financial Advisers) Regulations, 2026 (“Draft Financial Advisers Regulations”) on February 24, 2026. The Draft Regulations are applicable to financial institutions in the IFSC and the financial advisers engaged by them. The Draft Financial Advisers Regulations provide a structured and institution-anchored regulatory framework for financial advisory services and aim to establish a comprehensive framework to strengthen investor protection and align the IFSC’s regulatory architecture with global standards. Key provisions of the Draft Financial Advisers Regulations require Financial Institutions to, without limitation, render only permitted services, satisfy robust ”Fit and Proper” engagement criteria, continuously monitor activities for suitability and conflict prevention, adhere to strict conduct and transparency standards, and maintain comprehensive records alongside an internal grievance redressal mechanism.

IFSCA issues Draft Electronic Trading Platform Regulations, 2026 to foster Institutional Trading Venues^[xiii](Link)

IFSCA has published its consultation paper on the draft IFSCA (Electronic Trading Platform) Regulations, 2026 (“Draft Regulations”) on February 24, 2026. The Draft Regulations are applicable to entities seeking to set up and operate Electronic Trading Platforms (“ETPs”) within the IFSC. The Draft Regulations provide a structured regulatory framework for institutional trading venues and aim to establish a comprehensive framework to match buyers and sellers of financial instruments, aligning the IFSC with global standards like the United States’ Alternative Trading Systems and European Multilateral Trading Facilities.

ETP operators are required to establish an appropriate compliance framework commensurate with the scale of their operations, including maintaining detailed transaction data for at least 8 (eight) years. 

IFSCA Notifies Amendments to Fund Management Regulations (Link)

The IFSCA on January 27, 2026, notified and brought into force the IFSCA (Fund Management) (Amendment) Regulations, 2026 (“Amendment Regulations”), which amend the IFSCA (Fund Management) Regulations, 2025 and inter alia provide for the following:

• KMP Experience Requirements: Retains the 5-year base experience requirement, with reductions to 3 years for professionally qualified candidates and 2–3 years for IFSCA-certified individuals depending on the role;
• PPM Extension Framework: Replaces the one-time extension with a structured multi-extension mechanism in 6-month increments, subject to timely filing and escalating fees (25% for the first extension, 50% for each subsequent one);
• Additional Winding Up Grounds and Custodian Appointment: Adds two new grounds for scheme wind-up (failure to achieve minimum corpus without PPM extension, and voluntary wind-up with no investors or funds). Schemes requiring an IFSC custodian are given a 24-month transition period during which an Indian or regulated foreign custodian may be appointed.

IFSCA Issues Modifications to AML, CFT and KYC Guidelines, 2022 (Link)

The IFSCA issued a circular dated January 2, 2026, introducing wide-ranging modifications and clarifications to the IFSCA (Anti Money Laundering, Counter-Terrorist Financing and Know Your Customer) Guidelines, 2022 (“AML/CFT/KYC Guidelines”), with immediate effect. The modifications were introduced pursuant to representations received from stakeholders and market participants, and to incorporate certain Government directives. 

The modifications inter alia include: (i) expansion of the applicability of the AML/CFT/KYC Guidelines to all regulated entities licensed, recognised, registered, or authorised by IFSCA, with IFSCA retaining discretion to grant specific exemptions; (ii) consolidation of previously granted exemptions into the AML/CFT/KYC Guidelines; (iii) formal recognition of IFSCA-registered KRAs under the IFSCA (KYC Registration Agency) Regulations, 2025; (iv) strengthening of customer due diligence, beneficial ownership verification, and confidentiality of risk categorisation, with a clarification that accounts shall not be restricted solely on account of the filing of suspicious transaction reports; and (v) updates to onboarding norms for low-risk NRI customers through the Video-based Customer Identification Process (“V-CIP”), limiting V-CIP onboarding to specified jurisdictions, facilitating Aadhaar-based e-KYC, and providing safeguards for persons with disabilities. 

Further, FAQs clarifying the scope and intent of provisions relating to V-CIP have also been issued and are available on the IFSCA website.

IFSCA approves FinTech Sandbox Framework (Link)

The IFSCA has approved an IFSCA FinTech Sandbox Framework, as evidenced by a press release dated March 16, 2026. This initiative is part of IFSCA’s broader regulatory and developmental approach towards fostering financial innovation within IFSCs in India, particularly in GIFT City.

This framework is designed to provide a controlled environment for testing innovative fintech products, services, and business models in a live environment with real customers, while ensuring appropriate safeguards and regulatory oversight. Such frameworks typically allow fintech entities to test their innovations under relaxed regulatory requirements for a limited period, enabling them to validate their concepts and business models before full-scale deployment. The IFSCA sandbox framework aligns with global best practices in financial innovation regulation and is expected to position India's IFSCs as competitive hubs for FinTech development. 

The approval of this framework demonstrates IFSCA's commitment to promoting technology-driven innovation in financial services within IFSCs, potentially covering areas such as payments, digital assets, wealth management technology, insurance technology, amongst other emerging FinTech applications relevant to international financial services attracting global players.

IFSCA highlights supervisory observations in relation to ensuring substance for Capital Market Intermediaries in GIFT IFSC (Link)

IFSCA has issued a press release dated March 19, 2026, outlining supervisory observations and measures in relation to ensuring substance in Capital Market Intermediaries (“CMI”) in GIFT IFSC. This initiative forms part of IFSCA’s ongoing supervisory mandate to uphold regulatory standards in the GIFT IFSC and ensure that the jurisdiction maintains its status as a centre of ”substance” with regulatory standards on par with other global financial centres. 

The main objective of this initiative is ensuring that these entities maintain adequate physical presence, operational capacity, and decision-making functions within the jurisdiction. The substance requirements are critical for preventing entities from using GIFT IFSC merely as a regulatory arbitrage vehicle without meaningful business operations or economic substance in the jurisdiction. CMIs regulated under the IFSCA (Capital Market Intermediaries) Regulations, 2021, are expected to demonstrate genuine business activities, adequate infrastructure, qualified personnel, and substantive decision-making capabilities within GIFT IFSC to maintain their registration and regulatory standing. The supervisory observations are intended to reinforce compliance with substance requirements and ensure that GIFT IFSC continues to develop as a credible and well-regulated international financial centre that adheres to global standards of transparency and regulatory integrity. 

Guidelines for Credit Rating Agencies Regarding Non-SEBI Regulated Instruments (Link) 

SEBI has, via a circular dated February 10, 2026 (“Circular”), issued guidelines regarding the obligations of Credit Rating Agencies (“CRAs”) when undertaking ratings of financial instruments regulated by other Financial Sector Regulators (“FSRs”). 

The Circular, inter alia, 

• mandates the use of separate email IDs for grievance redressal and distinct website sections for disclosures related to SEBI versus non-SEBI activities; 
• requires that the minimum net worth mandated by SEBI remains unimpacted by other activities, with any FSR-specific capital requirements being in addition to SEBI’s limits; 
• necessitates clear marketing and website disclosures stating that SEBI investor protection and dispute redressal mechanisms are unavailable for non-SEBI regulated instruments; 
• compels CRAs to obtain written confirmations from clients acknowledging the regulatory risks and the absence of SEBI protections; and 
• requires an undertaking of compliance to be submitted as part of the half-yearly internal audit report, duly approved by the CRA's board of directors.

SEBI Notifies SEBI (Mutual Funds) Regulations, 2026 (Link)

SEBI issued a notification dated January 14, 2026, notifying the SEBI (Mutual Funds) Regulations, 2026 (“MF Regulations”), which shall come into force with effect from April 1, 2026, replacing the SEBI (Mutual Funds) Regulations, 1996 (“1996 Regulations”). A few critical aspects introduced by the MF Regulations inter alia include:

• MF Lite: A new category for passive schemes (index funds, ETFs, fund of funds), allowing sponsors to hold separate registrations and transfer eligible schemes to a group entity’s MF Lite, after which the original fund cannot launch new passive schemes.
• AMC Vicarious Liability: Narrowed to apply only where employee actions occur in the course of regulatory duties and involve negligence, breach of duty, or non-compliance - more defined than the blanket liability under the 1996 Regulations.

SEBI Notifies SEBI (Stock Brokers) Regulations, 2026 (Link)

SEBI notified the SEBI (Stock Brokers) Regulations, 2026 (“Stock Broker Regulations”) on January 7, 2026. The Stock Broker Regulations repeal the SEBI (Stock Brokers) Regulations, 1992 and introduce a consolidated rulebook governing all aspects of the broking profession including registration, eligibility, conduct, governance, compliance, inspection, enforcement, and investor grievance redressal. The Stock Broker Regulations inter alia provide for the permissible activities under the new regulations, registration and disclosure requirements, and reporting and record retention timelines.

SEBI proposes introduction of Gift Cards and Prepaid Payment Instruments for Mutual Funds (Link)

SEBI has released a consultation paper on the introduction of Gift Card/Gift PPIs for Mutual Funds dated March 24, 2026, proposing to enable investors to invest in mutual fund schemes through gift cards and PPIs. This initiative follows a proposal received from the Association of Mutual Funds in India (“AMFI”) to consider allowing gift cards as an innovative payment mechanism for mutual fund investments. The proposed framework aims to democratise mutual fund investments by introducing a novel payment channel that could make investments more accessible and attractive, particularly for gifting purposes and to encourage savings culture among retail investors. 

The consultation paper outlines the regulatory framework, operational guidelines, and safeguards that would govern the issuance and use of gift cards and PPIs specifically for mutual fund investments. This move is expected to boost mutual fund penetration in India by offering consumers alternative and convenient payment options, aligning with the broader objective of promoting financial inclusion and investor participation in capital markets. 

AMFI Issues Master Circular for Mutual Fund Distributors (Link)

The Association of Mutual Funds in India (“AMFI”) has, vide circular dated January 14, 2026, issued the AMFI Master Circular for Mutual Fund Distributors (“Master Circular”), consolidating all circulars, guidelines, and procedural instructions issued by AMFI in relation to mutual fund distributors (“MFDs”) up to December 31, 2025, into a single document. The Master Circular has been issued with a view to facilitating ease of reference for stakeholders and ensuring uniform compliance by MFDs.

The Master Circular inter alia covers: (i) registration requirements for domestic and overseas MFDs, including the mandatory NISM Series V-A certification, allotment of AMFI registration numbers and employee unique identification numbers, and permissible nomenclature for MFDs; (ii) empanelment of MFDs with AMCs; (iii) eligibility conditions for payment of commissions to MFDs; (iv) a standardised process for transfer of client assets under management from one MFD to another; (v) the code of conduct applicable to MFDs; and (vi) operational matters including the annual Declaration of Self-Certification , treatment of business received through suspended MFDs, and clarifications on transactions under direct plans.

The Master Circular also addresses FAQs on key aspects of MFD registration and operations.

TRAI releases Draft Telecom Commercial Communication Preference (Third Amendment) Regulations, 2026 for Consultation (Link)

TRAI, on March 13, 2026, issued the draft Telecom Commercial Communications Customer Preference (Third Amendment) Regulations, 2026, for public consultation. These proposed amendments seek to further strengthen the regulatory framework for curbing the menace of Unsolicited Commercial Communications (“UCC”). The principal Telecom Commercial Communications Customer Preference Regulations, 2018 (“TCCCPR 2018”) were originally issued on July 19, 2018, to put in place a comprehensive framework for regulating commercial communication and protecting consumers from unsolicited spam calls and messages. The current proposed third amendment has been formulated based on feedback received from stakeholders during various interactions, as well as in light of recent developments including the implementation of AI-based detection of UCC by major access providers. 

TRAI has recognized that in view of these technological advancements and stakeholder experiences, there is a need to make amendments in some of the existing provisions and to add new provisions to make the regulatory framework more effective and efficient in combating unsolicited commercial communications. The draft regulations have been placed on TRAI’s website for stakeholder consultation, with written comments on the issues raised in the draft amendment to be submitted in the specified format by April 19, 2026, and counter comments, if any, by May 4, 2026.