BSE Social Stock Exchange
A new segment on the BSE that enables Social Enterprises to tap into a much wider pool of investors and donors.
SSE will not only help the growing investment market but also a more regulated capital market
The pronouncement by Hon. Finance Minister, Smt. Nirmala Seetharaman, in her budget speech of July 2019, of setting up a Social Stock Exchange in the country for both Not for profit and For profit social enterprises, has resulted in creation of a separate segment on BSE catering only to Social Enterprises.
The SSE is designed for:
Meeting Investment
Demand
Meeting Investment Demand
To solve the fund crunch faced
by social enterprises
To solve the fund crunch faced by social enterprises
Transparency &
Accountability
Transparency & Accountability
To ensure the proper
utilisation of funds
To ensure the proper utilisation of funds
Performance-Based
Philanthropy
Performance-Based Philanthropy
To reward high-
performing projects
To reward high-performing projects
It is time to take our capital markets closer to the masses and meet various social welfare objectives related to inclusive growth and financial inclusion. I propose to initiate steps towards creating an electronic fund raising platform – a social stock exchange – under the regulatory ambit of Securities and Exchange Board of India (SEBI) for listing social enterprises and voluntary organizations working for the realization of a social welfare objective so that they can raise capital as equity, debt or as units like a mutual fund.
Nirmala Sitharaman
Finance Minister, Govt. of India
The SSE, as the Social Stock Exchange is more fondly called, has been set up as a new segment on the BSE and will enable Social Enterprises to tap into a much wider pool of investors and donors, and allow the investors and donors far greater transparency into the impact that their monies are creating.
Frequently Asked Questions
What is Social Stock Exchange (SSE)?
Social Stock Exchange (SSE) is a separate segment of the existing Stock Exchange, that can help Social Enterprise(s) to raise funds from public through the stock exchange mechanism. SSE will act as a medium between Social Enterprises and fund providers and that can help them to select those entities that are creating measurable social impact and reporting such impact. Certain type of Social Enterprises i.e. Not-for-profit organizations (NPOs) that meet the registration criteria can register on SSE and undertake to make continuous disclosures on their social impact. Such NPOs may or may not choose to raise funds through SSE, however, would continue to make disclosures including on social impact to stock exchanges.
.
What is a Not-for-profit organization in the context of Social Stock Exchange?
A not for profit organization is an entity which meets the criteria to be identified as a social enterprise and is any of the following entities:
- a charitable trust registered under the public trust statute of the relevant state;
- a charitable society registered under the Societies Registration Act, 1860 (21 of 1860);
- a company incorporated under section 8 of the Companies Act, 2013 (18 of 2013);
- any other entity as may be specified by SEBI;
.
What is a for profit social enterprise in the context of Social Stock Exchange?
A for profit social enterprise is an entity which meets the criteria to be identified as a social enterprise and is any of the following entities:
- A company under the Companies Act, 2013, operating for profit and does not include a company incorporated under section 8 of the Companies Act, 2013 (18 of 2013);
- A body corporate operating for profit
.
What are the ways in which a Not-for-profit organization can raise funds through Social Stock Exchange?
A Not-for-Profit organization after registering with Social Stock Exchange may raise funds on Social Stock Exchange through
- Issuance of Zero Coupon Zero Principal Instruments [through private placement or public issuance
- Donations through Mutual Fund Schemes [as shall be specified by SEBI]
- Development Impact Bonds
- Any other means that SEBI may specify in future
.
About SSE
The pronouncement by Hon. Finance Minister, Smt. Nirmala Seetharaman, in her budget speech of July 2019, of setting up a Social Stock Exchange (SSE) in the country for both Not for profit and For profit social enterprises, has resulted in creation of a separate segment on BSE catering only to Social Enterprises.
The SSE will not only help the growing investment market but also a more regulated capital market in India. It will also help impact investment to become more accessible which will increase the flow of money into sustainable development.
About BSE
Established in 1875, BSE (formerly known as Bombay Stock Exchange), is Asia’s first & the Fastest Stock Exchange in world, with a speed of 6 micro seconds, and one of India’s leading exchange groups. Over the past 143 years, BSE has facilitated the growth of the Indian corporate sector by providing it an efficient capital-raising platform. Popularly known as BSE, the bourse was established as ‘The Native Share & Stock Brokers’ Association’ in 1875. In 2017 BSE became the 1st listed stock exchange of India.
Today BSE provides an efficient and transparent market for trading in equity, currencies, debt instruments, derivatives, and mutual funds. BSE SME is India’s largest SME platform which has listed over 250 companies and continues to grow at a steady pace. BSE StAR MF is India’s largest online mutual fund platform which processes over 27 lakh transactions per month and adds almost 2 lakh new SIPs every month. BSE Bond, the transparent and efficient electronic book mechanism process for private placement of debt securities, is the market leader with more than Rs 2.09 lakh crore of fund raising from 530 issuances. (F.Y. 2017-2018).
