SEBI/HO/AFD/AFD - POD - 1/P/CIR/2025/128 — THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992

CIRCULAR SEBI/HO/AFD/AFD - POD - 1/P/CIR/2025/128 September 10 , 2025 To, All Alternative Investment Funds (AIFs) Sir/Madam, Sub: Revised regulatory framework for Angel Funds under AIF Regulations With the objective of improving ease of doing business, enhancing risk reduction and providing operational clarity to Angel Funds , Securities and Exchange Board of India (Alternative Investment Funds) Regulations, 2012 ("AIF Regulations") have been amended and notified on September 09, 2025, to prescribe the revised regulatory framework for Angel Funds . A copy of the notification is given here . In this context , the specific conditions and modalities with respect to various provisions pertaining to Angel Funds are being prescribed by way of this circular. A. Fund raising by Angel Funds – In terms of Regulation 19D(1) of AIF Regulations, Angel Funds shall raise funds only from Accredited Investors by way of issue of units, in the manner as may be specified by SEBI from time to time. In this regard, the following is specified – 2.1. Angel Funds which are granted registration by SEBI post the issuance of this circular, shall on-board and offer investment opportunities to Accredited Investors only . 2.2. Angel Funds registered with SEBI on or before the date of issuance of this circular shall comply with the following – (a) Such Angel Funds shall implement the aforesaid mandate on or before September 08, 2026 and shall not offer investment opportunity to more than 200 non -Accredited Investors during this period. (b) Such Angel Funds shall not accept contribution for investment in an investee company from non-Accredited Investors , post September 08, 2026 . (c) Existing investors of such Angel Funds shall continue to hold their investments already made in the Angel Fund as per