The Securities and Exchange Board of India (Sebi) has proposed a significant expansion for online bond platform providers (OBPPs) by allowing them to operate within the GIFT International Financial Services Centre (IFSC) in Gandhinagar, Gujarat, India. This move follows a request from the International Financial Services Centres Authority (IFSCA) to enable OBPPs to offer overseas-listed debt securities, thereby broadening their access to global debt markets. Currently, while stockbrokers can operate in GIFT City through separate business units, OBPPs have not been explicitly permitted to offer IFSCA-regulated products. The proposal aims to align OBPP operations with those of stockbrokers, ensuring compliance with foreign exchange rules and investment limits under the Liberalised Remittance Scheme.

Additionally, Sebi has suggested that OBPPs should be allowed to offer tax-saving bonds under Section 54EC of the Income Tax Act, which are issued by government-backed entities and currently exempt from mandatory listing requirements. The proposal mandates that OBPPs disclose key features of these bonds, including eligible issuers and tax benefits. Furthermore, Sebi plans to ease the norms for appointing compliance officers for OBPPs, allowing broader eligibility criteria rather than restricting the role to company secretaries. The regulator has invited feedback on this consultation paper until May 26.