The Securities and Exchange Board of India (SEBI) has proposed a clear financial benchmark to identify market indices that will come under its regulatory supervision. The initiative is aimed at strengthening transparency, accountability, and governance standards in the creation and management of widely used market indices.

In a consultation paper released on Monday, SEBI stated that any index used or tracked as a benchmark by domestic mutual fund schemes with aggregate assets under management (AUM) exceeding ₹20,000 crore will be classified as a “significant index.” Such indices would be governed by the Index Provider Regulations, 2024.

Framework for Calculating Cumulative AUM

As per the proposal, cumulative AUM will be determined based on the daily average AUM of domestic mutual fund schemes for each month over the previous six months. This evaluation will be carried out twice annually, using June 30 and December 31 as reference dates.

In cases where a mutual fund scheme follows multiple indices, only the AUM attributable to each specific index will be considered. For composite products or indices built on other indices, the AUM will be allocated to the underlying indices according to their respective weightings.

Identification of “Significant Indices”

SEBI noted that the proposed threshold and computation methodology were finalised after internal reviews and consultations with the Association of Mutual Funds in India (AMFI). Applying this framework to mutual fund AUM data between January 1 and June 30, 2025, the regulator identified 47 indices as significant across equity, debt, and hybrid segments.

These indices are managed by BSE Index Services, NSE Indices, and CRISIL, and include prominent benchmarks such as the BSE Sensex, Nifty 50, Nifty Bank, Nifty 500, and BSE 500, along with several sector-specific, duration-based, and money market indices.

Registration Requirements and Exemptions

Under the draft circular, index providers managing significant indices will be required to seek SEBI registration within six months from the date the circular comes into effect. However, indices that are already regulated by the Reserve Bank of India (RBI)—including benchmarks officially notified by the central bank—will be exempt from this registration requirement.

Grievance Redressal and Public Consultation

SEBI clarified that its grievance redressal framework under the Index Provider Regulations will apply only to significant indices offered by SEBI-registered index providers. Subscribers to such indices will be eligible to raise complaints through SEBI’s redressal mechanism.

The regulator has invited feedback from stakeholders and the general public on the consultation paper, with the deadline for comments set at February 10, 2026.

Summary

SEBI has proposed a ₹20,000 crore cumulative AUM threshold to identify “significant indices” that will fall under its regulatory ambit. The move seeks to enhance governance and transparency in index administration. Based on recent mutual fund data, 47 major indices have been identified as significant. SEBI has invited public comments on the proposal, with final regulations expected after stakeholder feedback.

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