Sebi mulls carving out separate AIF category to buy distressed loans from banks

Markets regulator Sebi is planning to carve out a separate category in Alternative Investment Funds (AIF) whereby such entities can purchase distressed loans from banks and NBFCs. Pointing out the growing number of AIFs, Sebi Chairperson Ajay Tyagi said on Thursday that the last financial year saw 90 new AIFs getting registered with the regulator under different categories, taking the total number to more than 700.

"This would unlock the capital of banks and NBFCs and make it available for fresh lending. A new sub-category of AIFs could be carved out for this purpose," he added. Acknowledging the pick-up in launching of ESG-themed schemes by mutual funds in India over past few years, Tyagi said the regulator, at present, is engaging with the industry about disclosing certain broad ESG-related parameters in respect of such schemes.