Accredited Investor in India: Lower Minimums for AIF, PMS and SIF

An accredited investor in India is a person or entity that has cleared SEBI's income or net worth tests and holds a certificate from a SEBI-recognised accreditation agency. The certificate lets you invest below some regulatory minimums, such as ₹1 crore for an AIF, ₹50 lakh for a PMS and ₹10 lakh for an SIF, and opens a few products that only accredited investors can buy.

It does not make any product less risky, shorten a lock-in or reduce fees. This guide covers the rules as they stand on 12 October 2026.

What is the SEBI accredited investor framework

SEBI introduced the framework through amendments to the SEBI (Alternative Investment Funds) Regulations, 2012 and the SEBI (Portfolio Managers) Regulations, 2020, notified on 3 August 2021. The working rules followed in a SEBI circular dated 26 August 2021. The definition sits in regulation 2(1)(ab) of the AIF Regulations, and the SEBI (Mutual Funds) Regulations, 2026 borrow the same definition for SIFs.

The framework has been refined several times since:

• A SEBI circular of 18 December 2023 lengthened the validity of a certificate and simplified the documents.
• AIF amendments in September and November 2025 made angel funds and co-investment schemes accredited-only and created "Accredited Investors only funds".
• A SEBI circular of 9 January 2026 let AIF managers sign up an investor while the certificate is pending.

Some investors never need a certificate. The Central and State Governments, their developmental agencies and funds, qualified institutional buyers, Category I foreign portfolio investors, sovereign wealth funds and multilateral agencies are treated as accredited automatically.

Accreditation is still uncommon. A SEBI board memorandum for its 24 September 2026 meeting counted 4,492 accredited investors on 28 August 2026, up from 649 on 29 May 2025.

What are the accredited investor criteria for income and net worth

Individuals, Hindu Undivided Families (HUFs), family trusts and sole proprietorships qualify if they meet any one of three tests:

• Income test: annual income of ₹2 crore or more.
• Net worth test: net worth of ₹7.5 crore or more, of which at least ₹3.75 crore is in financial assets.
• Mix test: annual income of ₹1 crore or more and net worth of ₹5 crore or more, of which at least ₹2.5 crore is in financial assets.

Other entities have their own tests:

• Body corporates, and trusts other than family trusts, need net worth of ₹50 crore or more.
• A partnership firm qualifies only if each partner meets the criteria independently.

For individuals, HUFs and sole proprietors, the primary residence is left out of net worth. For joint holdings of a parent and child, at least one of them must qualify alone; spouses may combine their income or net worth. Foreign investors are tested on the rupee equivalent of their figures.

How the mix test works

Take an individual with annual income of ₹1.2 crore and net worth of ₹6 crore excluding the family home, ₹3 crore of it in financial assets. They miss the income and net worth tests, but pass the mix test because income clears ₹1 crore, net worth clears ₹5 crore and financial assets clear ₹2.5 crore.

How to become an accredited investor in India

1. Work out your route. Check which test you meet on your latest financial year figures. A chartered accountant can confirm the financial asset split.
2. Collect the documents. Individuals, HUFs and sole proprietors need their PAN and an officially valid document; companies and trusts need their PAN, incorporation documents or trust deed, and an authorisation letter. For the financial test you need income tax returns (for individuals, HUFs, family trusts and sole proprietorships), audited financial statements, or a chartered accountant's net worth certificate not older than six months. Since January 2026, the chartered accountant may certify that you cross the threshold without stating the exact figure, and a detailed break-up of net worth is no longer required.
3. Apply to an accreditation agency. SEBI currently recognises two, both subsidiaries of India's depositories. The agency verifies your KYC and financial information.
4. Receive the certificate. It carries a unique accreditation number, the agency's name, your PAN and start and end dates.

How long accreditation lasts

Under the December 2023 circular, a certificate is valid for:

• two years if you met the criteria in the preceding financial year;
• three years if you met them in each of the preceding two financial years;
• two years for a newly incorporated entity that meets the net worth test on the date of application.

Before that circular, the periods were one year and two years.

Using the certificate with a product

When you invest, you give the product provider a copy of the certificate and an undertaking. In it you consent to use the framework, confirm you understand the product and can bear its risks, and accept that it may not carry the same regulatory oversight as products for other investors. The provider checks your status directly with the agency and must disclose the concessions and their conditions before you sign.

Since 9 January 2026, an AIF manager that has assessed your eligibility can sign your contribution agreement while your certificate is pending. Your commitment does not count towards the scheme's corpus, and the fund cannot take your money, until the certificate arrives.

What can an accredited investor invest in

AIF below ₹1 crore

Regulation 10(c) of the AIF Regulations sets the ₹1 crore floor and, since 3 August 2021, says it does not apply to an accredited investor. Since 19 November 2025, accredited investors are also left out when counting the 1,000-investor limit per scheme. The minimum for a Special Situation Fund falls from ₹10 crore to ₹5 crore.

Accreditation is also the entry ticket to products others cannot buy:

• Angel funds: since September 2025, they may raise money only from accredited investors, with no minimum investment. Funds registered on or before 10 September 2025 have until 31 March 2027 to comply.
• Co-investment schemes: since 9 September 2025, Category I and II AIFs may offer a separate co-investment scheme alongside a fund investment, open only to their accredited investors.

Removing the floor does not oblige a fund to accept a small cheque; each placement memorandum sets its own minimum commitment. For how the three categories differ on tenure and tax, see AIF categories explained and Sanriya's AIF page.

Large Value Funds and Accredited Investors only funds

Since 19 November 2025, the AIF Regulations recognise "Accredited Investors only funds": schemes in which every investor, other than the manager, the sponsor, and employees or directors of the fund or of its manager, is accredited. A Large Value Fund for Accredited Investors is one of these in which each such investor commits at least ₹25 crore; until 19 November 2025 the figure was ₹70 crore.

These funds get lighter rules:

• They can launch on filing the placement memorandum with SEBI, without waiting for SEBI's comments.
• They may extend tenure by up to five years with approval of two-thirds of unit holders by value, against two years for other schemes.
• They may give investors different rights instead of pari-passu rights, with disclosure in the placement memorandum and an undertaking from each investor.
• A Category I or II Large Value Fund may put up to 50% of investable funds in one company (25% for other schemes); a Category III one up to 20% (10% otherwise).

Each of these relaxations removes a protection that other schemes give you.

What changes for PMS

Under regulation 23(2) of the SEBI (Portfolio Managers) Regulations, 2020, the ₹50 lakh minimum does not apply to an accredited investor, subject to the disclosure document and the terms agreed with the portfolio manager. A "large value accredited investor", one with an agreement of at least ₹10 crore, gets two further relaxations: the standard contents of the client agreement are not compulsory, and the portfolio manager may invest up to 100% of the portfolio in unlisted securities.

For every other client, a discretionary PMS invests in securities listed or traded on a stock exchange, money market instruments and mutual fund units, and a non-discretionary PMS may put at most 25% of a client's portfolio in unlisted securities. Unlisted securities can be hard to value and to sell.

The SEBI (Portfolio Managers) Regulations, 2026, notified on 7 October 2026 and in force from 1 April 2027, keep both relaxations. Your securities still sit in your own demat account. Sanriya's PMS page covers how PMS works.

The SIF ₹10 lakh exemption

The SEBI circular of 27 February 2025, now carried in regulation 49(1) of the SEBI (Mutual Funds) Regulations, 2026, says a Specialized Investment Fund cannot accept less than ₹10 lakh from an investor across all its strategies, except from an accredited investor. A strategy's Investment Strategy Information Document (ISID) can still set its own minimum for accredited investors, so the ticket size varies by strategy. Our guide to the SIF ₹10 lakh rule covers everyone else.

Does accreditation change risk, lock-in, fees or tax

No. It changes the minimum ticket, not the risks and costs of the product:

• Risk. The strategy, its market risk and its liquidity are the same whatever cheque you write. The certificate itself says the agency checked only your KYC and financial information.
• Lock-in. Category I and II AIFs stay close-ended with a minimum tenure of three years, and an Accredited Investors only fund can extend for longer than other schemes.
• Fees. Management and performance fees are set by the product, and 18% GST still applies to PMS fees.
• Tax. Accreditation is a SEBI status, not a tax status: an AIF, PMS or SIF is taxed as it would be for any other investor.
• Your exit from the framework. You can withdraw consent, but if you used a lower ticket you must top up to the normal minimum within the time your agreement allows. In pooled products launched only for accredited investors with regulatory concessions, you cannot withdraw consent at all.

What did SEBI approve for accredited investors in September 2026

On 24 September 2026, SEBI's board approved changes to widen the framework:

• AIF managers, fund houses offering SIFs and portfolio managers may accredit investors, as an optional route alongside the agencies.
• A new test based on securities market exposure: ₹5 crore for individuals, HUFs, family trusts and sole proprietorships, and ₹20 crore for body corporates and other trusts.
• All persons resident outside India, including foreign portfolio investors, to be treated as accredited automatically.
• Limited liability partnerships to qualify where each partner qualifies.
• A three-year validity under both routes.

These changes take effect only from the date the amended regulations are notified. On 12 October 2026, the AIF Regulations on SEBI's website were last amended on 14 July 2026, so the current tests and validity periods still apply.

Who uses accreditation

Accreditation is used by investors who already hold, or are looking at, alternative products: families spreading an AIF allocation across more than one manager, investors in angel funds or co-investment schemes, and family offices looking at Large Value Funds, where each investor commits at least ₹25 crore.

The ticket changes, not the product: a smaller cheque into a high-risk, illiquid product is still high-risk and illiquid, and whether to use accreditation is your decision.

How Sanriya helps

Sanriya Finvest Pvt. Ltd., Pune, is an AMFI-registered mutual fund distributor (ARN-193359) and an APMI-registered PMS distributor (APRN01056). We explain how accreditation works for the AIF, PMS or SIF you are considering, help you put together the documents the accreditation agency and the product provider ask for, and service the investment afterwards. We distribute under the Regular plan and receive commission from the product manufacturer, which is built into the product's costs; we do not charge you a separate fee, and the decision to seek accreditation and to invest stays with you. Contact us to talk it through.