Summary: SEBI requires Research Analysts (RAs) to maintain a deposit under Regulation 8 of the SEBI (Research Analysts) Regulations, 2014, with the applicable amount determined by the maximum number of clients on any day during the previous financial year. The prescribed deposit ranges from ₹1 lakh for up to 150 clients to ₹10 lakh for 1,001 or more clients. Where an RA chooses the scheduled-bank deposit route, the deposit is required to be lien-marked in favour of the Research Analyst Administration and Supervisory Body (RAASB), with BSE Limited recognised as RAASB. The procedure involves determining the applicable amount, approaching an eligible scheduled bank, creating the deposit in the prescribed name, ensuring appropriate tenure and renewal instructions, obtaining the FDR and bank confirmation, submitting the prescribed documents and continuously monitoring compliance. Importantly, following SEBI Circular No. SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/116 dated August 12, 2025, a fixed deposit is no longer the only available mode. Research Analysts may meet the deposit requirement through units of liquid mutual funds, units of overnight mutual funds, or a deposit maintained with a scheduled bank, subject to the prescribed lien in favour of RAASB.
- Introduction
- Deposit Requirement for Research Analysts
- Where is the Fixed Deposit to be Maintained?
- Procedure for Creating Fixed Deposit for Research Analyst Registration
- Step 1 – Determine the Applicable Deposit Amount
- Step 2 – Approach an Eligible Scheduled Bank
- Step 3 – Creation of Fixed Deposit
- Step 4 – Tenure and Renewal
- Step 5 – Obtain the Fixed Deposit Receipt
- Step 6 – Submit the FDR to RAASB
- Step 7 – Maintain the FD and Monitor Renewal
- Important Change: FD is Not the Only Option
- Conclusion
Introduction
The Securities and Exchange Board of India (SEBI) has prescribed a deposit requirement for Research Analysts (RAs) under Regulation 8 of the SEBI (Research Analysts) Regulations, 2014. The deposit is intended to provide a mechanism for meeting certain dues arising out of arbitration and conciliation proceedings under the Online Dispute Resolution (ODR) mechanism or such other mechanism specified by SEBI.
SEBI, through its guidelines issued on January 8, 2025, prescribed the deposit requirement based on the maximum number of clients of a Research Analyst during any day of the previous financial year.
Deposit Requirement for Research Analysts
The applicable deposit requirement is as follows:
| Maximum number of clients | Required deposit |
|---|---|
| Up to 150 clients | ₹1 lakh |
| 151 to 300 clients | ₹2 lakh |
| 301 to 1,000 clients | ₹5 lakh |
| 1,001 and above clients | ₹10 lakh |
The applicable amount is determined with reference to the maximum number of clients on any day during the previous financial year. Where the applicable deposit amount changes, the revised amount is required to be maintained by 30 April of the subsequent financial year.
Where is the Fixed Deposit to be Maintained?
Under the framework specified by SEBI, the deposit may be maintained with a scheduled bank and is required to be marked as a lien in favour of the Research Analyst Administration and Supervisory Body (RAASB).
BSE Limited is the recognised RAASB for Research Analysts and has specified the manner and form in which the deposit is to be maintained.
Procedure for Creating Fixed Deposit for Research Analyst Registration
A Research Analyst intending to comply with the deposit requirement through a fixed deposit may generally follow the following procedure:
Step 1 – Determine the Applicable Deposit Amount
The applicant should first determine the applicable deposit amount based on the number of clients.
For a new Research Analyst applicant, the minimum applicable deposit would ordinarily be ₹1 lakh, where the client count falls within the first slab.
Step 2 – Approach an Eligible Scheduled Bank
The Research Analyst should approach a scheduled bank permitted under the RAASB’s applicable procedure for creation of the fixed deposit.
The applicant should clearly inform the bank that the fixed deposit is being created for compliance with the SEBI Research Analyst deposit requirement and that the deposit is required to be lien-marked in favour of the RAASB.
Step 3 – Creation of Fixed Deposit
As per the procedure communicated by BSE/RAASB, the fixed deposit is to be issued in the name:
“BSE Ltd. A/c. [Name of Research Analyst]”
The FD is required to carry a lien in favour of BSE Limited in its capacity as RAASB.
Step 4 – Tenure and Renewal
The BSE procedure specifies that the FD should have a tenure of five years or more.
The Research Analyst should instruct the bank for automatic renewal of the fixed deposit. The principal amount and interest treatment should be as instructed to the bank, so that the deposit remains compliant on an ongoing basis.
Step 5 – Obtain the Fixed Deposit Receipt
After creation of the FD, the Research Analyst should obtain the Fixed Deposit Receipt (FDR) and the prescribed confirmation/letter from the bank confirming the required lien.
The documents should be carefully checked to ensure that:
- Name of the RA is correctly mentioned;
- Amount of FD is correct;
- Lien is correctly marked;
- The beneficiary/RAASB name is correctly stated;
- Tenure and renewal instructions are correctly recorded; and
- The bank’s confirmation is in the prescribed format.
Step 6 – Submit the FDR to RAASB
The soft copy of the FDR is required to be shared with BSE/RAASB through the prescribed email/process.
The BSE procedure also requires submission of the original FDR, duly discharged, along with the bank’s FDR letter and the prescribed covering letter to the designated BSE office.
Step 7 – Maintain the FD and Monitor Renewal
The deposit requirement is a continuous compliance requirement. Therefore, the Research Analyst should not treat creation of the FD as a one-time formality.
The RA should maintain the required deposit throughout the period of registration and ensure that the FD is renewed before expiry.
BSE’s procedure also provides for renewal-related communication and requires RAs to ensure timely renewal of their FDRs.
Important Change: FD is Not the Only Option
A significant change was introduced by SEBI through Circular No. SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/116 dated August 12, 2025.
SEBI permitted Research Analysts to meet the deposit requirement through:
- Units of liquid mutual funds;
- Units of overnight mutual funds; or
- Deposit maintained with a scheduled bank.
The relevant units/deposit are required to be marked with a lien in favour of the RAASB in the manner specified by the RAASB.
Accordingly, an article written today should not state that every Research Analyst is mandatorily required to create a fixed deposit. Rather, an FD is one of the permitted modes of satisfying the deposit requirement.
Conclusion
The deposit requirement is an important compliance condition for Research Analysts registered with SEBI. For RAs choosing the bank-deposit route, the fixed deposit must be created in the prescribed manner, appropriately lien-marked in favour of the RAASB, and maintained continuously.
Research Analysts should also monitor the number of clients during the financial year because an increase in the applicable client slab may result in an increase in the amount of deposit required.
With the introduction of liquid mutual funds and overnight mutual funds as alternative modes of maintaining the deposit, RAs now have greater flexibility in complying with the requirement. The applicable procedure and documentation prescribed by the RAASB should, however, be followed carefully.
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Disclaimer: This article is intended for general informational purposes only and should not be construed as professional or legal advice. Readers should refer to the latest SEBI regulations, circulars, master circulars and instructions issued by the RAASB before taking any compliance action.
