Any person who wishes to carry on investment advisory services for its clients should get themselves registered as Investment Adviser (IA) with SEBI. SEBI has specified the eligibility criteria and conditions that one must fulfill before making an application with it.

Before starting with the conditions that one must fulfill to become an IA, let us first understand-

Who is an Investment Adviser?

An Investment Adviser means any person, who for consideration, is engaged in the business of providing investment advice to clients or other persons or group of persons and includes any person who holds out himself as an investment adviser.

# investment advice means advice relating to investing in, purchasing, selling or otherwise dealing in securities or investment products, and advice on investment portfolio containing securities or investment products, whether written, oral or through any other means of communication for the benefit of the client and shall include financial planning.

Now, in order to register yourself with SEBI as IA, you must fulfil the following conditions and criteria:

1. Qualification:

The first thing you should ensure before proceeding with the application is to meet the qualification requirements for making the application.

An individual IA or a principal officer of a non-individual IA or a person associated with investment advice should have the following minimum qualification, at all times:

(a) A professional qualification or post-graduate degree or post graduate diploma (which shall be of minimum two years in duration) in finance, accountancy, business management, commerce, economics, capital market, banking, insurance or actuarial science from a university or an institution recognized by the Central Government or any State Government or a recognised foreign university or institution or association; or

(b) a professional qualification by completing a Post Graduate Program in the Securities Market (Investment Advisory) from NISM of a duration not less than one year; or

(c) a professional qualification by obtaining a CFA Charter from the CFA Institute.

2. Experience:

An individual IA or a Principal Officer of a non-individual IA must have an experience of at least five years in activities relating to advice in financial products or securities or fund or asset or portfolio management.

However, a person associated with Investment Advice must have an experience of at least two years in activities relating to advice in financial products or securities or fund or asset or portfolio management.

3. Certification:

An individual IA or a principal officer of a non-individual IA or a person associated with investment advice should have a certificate on financial planning or fund or asset or portfolio or investment advisory services from:

(a) NISM; or

(b) any other organization or institution including Financial Planning Standards Board of India or any recognized stock exchange in India provided such certification is accredited by NISM.

Note:

  • A fresh NISM certification must be obtained before expiry of the validity of the certification to ensure the continuity in compliance with certification requirements.
  • A fresh NISM certification shall not be obtained through a CPE Program.

For Example: If you have an MBA degree in Finance (2 years course) with 5 years of experience as required and take NISM exam, you will fulfill the qualification and certification requirement.

However, if you have an MBA degree in marketing (2 years course) with 5 years of experience as required, you will not fulfill the qualification and experience requirement.

4. Net worth

The net worth requirement are as follows:

  • In case of non-individual investment advisers– The net worth should not be less than INR 50 Lacs.
  • In case of individual investment advisers– The net worth in form of net tangible assets should not be less than INR 5 Lacs.

*Net worth means the aggregate value of paid up share capital plus free reserves (excluding reserves created out of revaluation) reduced by the aggregate value of accumulated losses, deferred expenditure not written off, including miscellaneous expenses not written off.

The net worth certificate shall be obtained by a Chartered Accountant and shall be attached to the form while making an application with SEBI.

5. Adequate Infrastructure

You should ensure to have an adequate infrastructure which shall include office space, office equipment, furniture and fixtures, communication facilities, research capacity, research software for undertaking investment advisory services.

Application and Fee Structure

Once you are sure that you meet the above criteria, you can proceed with making an application with SEBI for IA. However, before proceeding you are required to take in-principal approval from BASL.

Click here to know the process for BASL membership registration

Once BASL sends you an approval email requesting you to proceed with filing of application with SEBI, you can start the process.

For this, you will require to login to https://siportal.sebi.gov.in/intermediary/index.html and complete the initial application process only then you will be able to proceed with the application with SEBI.

All the details mentioned in Form A are required to be provided along with all the necessary required documents as attachments.

Note: In order to grant the registration certificate under the IA Regulations, SEBI might want the applicant to furnish further information or clarification on the submitted documents.

Fee Structure for the application with SEBI:

Upon SEBI being fully satisfied with your application, will intimate you to make the payment for BASL membership (the fee structure for BASL membership is mentioned in the article, link to which is provided above).

SEBI on receiving internal approval from BASL on receipt of fees, will issue you the SEBI IA License. BASL on the other hand will issue you the certificate of membership.

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Hope the article gives you the clarity on the requirements for IA License. In case you have any query or are looking for any professional assistance to make an application, you may write to me at anjalibansalcs@gmail.com.

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Qualification: CS
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Location: Bengaluru, Karnataka, India
Member Since: 05 Jul 2021 | Total Posts: 12
Practicing Company Secretary |Company Law &LLP Compliance| FEMA & SEBI Regulations| Corporate Diligence for Start-Ups| Link to my website: www.anjalibansal.in View Full Profile

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12 Comments

  1. Nadeem says:

    Hi Anjali,

    I am an Automobile engg, later I worked in IT firms and have 15 years of IT experience. I am now interested in Financial worlds have been into markets since 2 years, lately I have thot to be SEBI registered for me what are the possibilities please guide.

  2. Deepali says:

    Hi Anjali,

    While making an application with SEBI for RIA license on behalf of my company; are running into the following queries:
    1. Particulars of Agent: What should we include in this section?

    2. Dispute Details- We do not have any disputes but this field is mandatory in application in the form of Pending and settlement of dispute.

    3. No. of employees & agents of the applicant who shall render investment advice under these regulations on behalf of the applicant: Can we fill the number of employees who will assist investment advisors but do not meet the qualification requirements set forth in Regulation 7?

  3. Chakkaravarthi says:

    Hi mam, this is chakkaravarthi and I am MBA (HR), currently I have doing mutual fund distributor , as well as doing CA Course, after my completion of CA with 5yrs MF distributor experience , am I eligible for register sebi RIA.

  4. Abhijeet says:

    Hi Anjali,
    I have completed my Mba finance, 2 years full time
    And i have total 3 years of work experience,
    Of which i have (2 years) fully as an associate portfolio manager in international organisation.
    And rest one year i have with BNY Mellon as an operations .

    Can i be eligible for being a Investment Advisor if i give the Nism level 1 and level 2 exam
    With just 2 years of portfolio management experience, please help with your guidance.
    Thanks,
    Abhijeet

  5. Prasenjit Biswas says:

    If a regular Arts graduate , with work experience in other fields wants to apply to become an Individual investment Advisor, is that allowed or only Graduates with a commerce background are permitted.

    1. CS Anjali Bansal says:

      Hi Prasenjit,

      A graduate irrespective of the field does not fulfill the qualification requirement for IA registration. One should have a post graduation degree or diploma (which shall be of minimum two years in duration) in finance, accountancy, etc.

      Please refer to Point#1 (Qualification) of my article to read in detail.

      Regards,
      Anjali

  6. CS Anjali Bansal says:

    Hi Roshan,

    Yes a CA or CMA with 5 years of experience in activities relating to advice in financial products or securities or fund or asset or portfolio management can act as a principal officer.

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