The SEBI has proposed easing rules around securitisation a process where financial institutions bundle together loans or receivables (money owed to them) into a packaged investment product called a securitised debt instrument, which is then sold to investors. Currently, SEBI's rules cap any single borrower's share in the asset pool (the bundle of loans) at 25%, meaning no one borrower can make up more than a quarter of that bundle this is meant to spread risk. However, this rule had been inadvertently blocking single-asset deals (where the entire bundle is backed by just one loan or asset), even though the RBI (India's central bank) already permits such structures for banks and NBFCs it regulates. To fix this, SEBI has proposed waiving the 25% cap specifically for RBI-regulated entities, enabling single-asset securitisation deals to be listed on exchanges. 

Additionally, SEBI has suggested moving the responsibility for regularly reporting on the performance of the asset pool from the originator (the entity that originally created the loans) to the servicer (the entity that collects repayments and monitors the loans), as the servicer is better positioned to provide accurate, timely information to investors. SEBI has also proposed changes to governance of SPDEs (Special Purpose Distinct Entities ring-fenced vehicles created solely to hold and manage securitised assets), limiting RBI-regulated originators to just one board seat without veto power, and replacing mandatory winding-up of troubled transactions with the option of appointing a new trustee instead making the overall framework more flexible and aligned with RBI norms.
 

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