Social Stock Exchange (SSE) segment is being launched to address the issues related to the funding of social enterprises. According to a statement from the National Stock Exchange (NSE), the final approval from SEBI for the same has been received on February 22 and it is being offered as a separate segment.
NSE MD & CEO Ashish Kumar Chauhan has said that we are conducting various programs to create awareness and are currently initiating various phases of onboarding on the Exchange. For this social enterprises have been urged to get registered in the social stock exchange segment and the benefits of listing can be understood by approaching NSE.
What is Social Stock Exchange for?
Non-Profit Organizations (NPOs) For-profit Social Enterprises (FPEs) or all such institutions that establish their primacy of social intent can be listed under the Social Stock Exchange. The move will provide visibility to social enterprises, as well as help in raising and mobilizing funds.
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Funds can be raised in this way
After listing, NPOs can start the process of raising funds by issuing Zero Coupon Zero Principal (ZCZP) through a public issue or private placement. At present, the rules have kept the minimum issue size for the issue of ZCZP at Rs 1 crore. At the same time, the minimum application size for membership has been fixed at Rs 2 lakh. The first step for onboarding begins with registration in the Social Stock Exchange segment.
Process of issuing securities
The procedure for the issue and listing of securities under the Social Stock Exchange shall be the same as applicable for the issue and listing of securities under the existing procedures of the Exchange. For this, eligibility criteria have been fixed for Main Board, SME Platform, or Innovators Growth Platform. Also, separate criteria have been laid down to qualify as social enterprises.
