NSE gets final nod from SEBI for Social stock exchange

Subject : Economy

Section: Financial Market

Concept :

The National Stock Exchange (NSE) has received final approval from the Securities and Exchange Board of India (SEBI) to set up a Social Stock Exchange (SSE) as a separate segment of the NSE.

About Social Stock Exchange:

SSE is a stock exchange, intended to benefit the private and non-profit sectors by directing more capital to them.
The SSE will function as a distinct division of the current stock exchanges under the new regulations.
Countries like the UK, Canada and Brazil have SSEs.

Who can list on SSE?

Not-for-profit organisations (NPOs) and for-profit social enterprises with social intent and impact as their primary goal will be eligible to participate in the SSE.
The social enterprises will have to engage in a social activity out of 16 broad activities listed by the regulator (SEBI).
The eligible activities include-
Eradicating hunger poverty, malnutrition and inequality
Promoting healthcare, supporting education, employability and livelihoods
Gender equality empowerment of women LGBTQIA communities.
Supporting incubators of social enterprise.
Corporate foundations, political or religious organisations or activities, professional or trade associations, infrastructure companies, and housing companies, except affordable housing, will not be eligible to be identified as social enterprises.
According to Sebi’s framework, a minimum issue size of ₹1 crore and a minimum application size for the subscription of ₹2 lakh are currently required for SSE.

Minimum requirements for sustenance

NPO needs to be registered as a charitable trust and should be registered for at least three years, must have spent at least ₹50 lakh annually in the past financial year.
They should have received a funding of at least ₹10 lakh in the past financial year.