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SEBI Introduces INR-Based Registration Fees for FPIs and FVCIs

SEBI has made important changes to the Foreign Portfolio Investor (FPI) Regulations to make foreign investment in the Indian capital market easier and more transparent. With this amendment, the registration fee of Foreign Portfolio Investors (FPIs) and Foreign Venture Capital Investors (FVCIs) will no longer be denominated in US dollars (USD). Instead, the fee has been fixed in Indian rupees (INR). 

SEBI has said that this new rule will come into effect after the end of a six-month transition period. So, this change is quite important for foreign investors, Designated Depository Participants (DDPs), custodians, and institutions interested in investing in India. It will simplify the fee collection and compliance process. 

In this article, we will discuss the new fee structure, the reason for the change, who will be covered by it, and the impact of this amendment. 

What is the New Amendment Regarding SEBI’s FPI Registration Fee? 

On July 3, 2026, SEBI issued the SEBI (Foreign Portfolio Investors) (Amendment) Regulations, 2026. This amendment simplifies and streamlines the registration fee payment procedure for foreign investors. 

Earlier, the registration fee for FPIs and FVCIs was payable in US dollars. The fee has now been denominated in Indian rupees. This will make the fee collection, accounting, and payment process easier. 

SEBI also stated that this amendment will not come into effect immediately upon publication. Market participants have been given six months to prepare. During this period, foreign investors, DDPs, custodians, and other related institutions will be able to update their internal systems and processes as per the new rules. 

Through this change, SEBI wants to create a more transparent, digital, and easy compliance system. 

New Rupee-based Registration Fee Structure 

Category-I FPIs and FVCIs 

SEBI has changed the registration fee for Category-I Foreign Portfolio Investors (FPIs) and Foreign Venture Capital Investors (FVCIs) as per the new rules. Earlier, this fee was USD 2,500. Now it has been fixed at ₹2.3 lakh. So, applicants can deposit the fee directly in Indian Rupees. 

Category-II FPIs 

A similar change has been made in the case of Category-II FPIs. Earlier, the registration fee was USD 250. According to the new rules, it has increased to ₹23,000. This will reduce the hassle of converting dollars to rupees a lot. 

Application for Regulatory Relaxation 

An application must be made to SEBI for special exemption or regulatory relaxation. Earlier, the application fee was USD 1,000. Now it has been changed to ₹90,000. However, there may be an opportunity to deposit an equivalent amount in an approved foreign currency as per SEBI guidelines. 

Late Fees and Continuance Charges 

Not only the registration fee but also the late fee and continuance charges have now been fixed in Indian rupees. The amount of these fees may vary depending on the situation. So, before applying, one should check the latest fee structure in the official SEBI notification. 

New Fee Structure 

Registration Category	Previous Fee	Revised Fee
Category-I FPIs & FVCIs	USD 2,500	₹2.3 lakh
Category-II FPIs	USD 250	₹23,000
Applications for Regulatory Relaxation	USD 1,000	₹90,000
Late Fees & Continuance Charges	USD-based	INR-based (as specified by SEBI)

Why did SEBI introduce Rupee-based Fees instead of Dollar-based Fees? 

SEBI introduced rupee-based fees to increase administrative efficiency and simplify the compliance process. Earlier, collecting fees in dollars often created additional calculation, conversion, and reporting problems. The new INR-based system will reduce complexity. 

The key reasons for this are– 

• Collection of fees will be easier, and the payment process can be completed faster. 
• Accounting and reconciliation will be easier, as the need for foreign currency conversion will be reduced. 
• Dependence on foreign exchange conversion will be reduced, resulting in less additional administrative work. 
• Financial reporting will be faster, as payments will be accepted directly in rupees. 
• Transparency will increase, and each fee can be easily tracked. 
• Real-time payment tracking will be possible, which is also convenient for SEBI. 
• Digital and automated compliance processes will be more effective. 
• This is an important step toward improving ease of doing business, as the administrative process will be easier for foreign investors. 

So, the registration process for foreign investors will remain the same as before, but the fee payment and compliance work will be much easier and streamlined. 

Important Compliance Changes with New Fee Revision 

Updated Common Application Form (CAF) 

SEBI has also made some important changes to the Common Application Form (CAF) with the new rules. Now, it is mandatory to mention the date of birth of individual applicants and the date of incorporation of companies or other entities. Adding this information will speed up the process of allotment of a Permanent Account Number (PAN). 

This change has been made in line with the guidelines of the CBDT (Central Board of Direct Taxes). This will reduce the need to submit the same information repeatedly, and the application process will also be easier. 

New deadline for DDPs 

As per the new rules, Designated Depository Participants (DDPs) will have to deposit the amount with SEBI within five working days of collecting the registration fee of FPI. 

In addition, DDPs will also have to submit all the fee-related information to SEBI in the prescribed format. This will make reporting more regular and increase transparency in the entire process of fee collection. 

Changes in Custodian Fee Payment 

SEBI has also brought changes in the method of payment of fees by custodians. Where earlier the fee had to be paid on an annual basis, now it will have to be paid monthly. 

This new system will simplify the financial planning of custodians. SEBI will also be able to collect fees regularly because the entire system will be more orderly and effective. 

Impact on Foreign Investors Due to the New Rules 

This amendment by SEBI does not bring any major changes to the investment process of foreign investors. Only the method of payment of fees has changed. However, compliance and administrative work will be much easier due to this change. 

Its key advantages are- 

• The registration process will be easier and more convenient. 
• There will be no uncertainty of currency conversion while paying the fee. 
• Compliance requirements can be followed more clearly. 
• The onboarding process for new applicants can be completed faster. 
• Budget planning for investment-related expenses will be easier. 
• Administrative work and internal accounting will be less complicated than before. 
• The fixed fee in rupees will help to plan expenses in advance. 

Overall, this change will make the registration and compliance process easier, more transparent, and more efficient for foreign investors. 

Impact on Designated Depository Participants (DDPs) and Custodians 

Designated Depository Participants (DDPs) 

The new rules have made the responsibilities of DDPs clearer than before. Now, they will have to submit registration fees to SEBI within the stipulated time and send reports in the prescribed format. This will make fee management and reporting more regular. 

Custodians 

The monthly fee payment system for custodians will make financial planning easier. Recordkeeping, reconciliation, and compliance management will be much more systematic than before. The administrative burden will also be reduced for the regular fee payment. 

Common Compliance Errors to Avoid Under the New FPI Rules  

Mistakes related to the registration fee 

•      Submitting an incorrect amount for the registration fee.
•      Using the old USD-based fee structure.
•      Paying fees after the stipulated time.

Documentation errors 

•      Not mentioning the Date of Birth or Date of Incorporation.
•      Providing incorrect or incomplete informationregardingPAN. 
•      Submitting an incomplete Common Application Form (CAF).

Common errors by DDPs 

•      Notsubmittingfees to SEBI within five working days. 
•      Submitting an incorrect fee report or incorrect information.
•      Notsubmittingrequired information in the prescribed format on time. 

These small errors can delay the application process. So, it is important to follow each step carefully as per the new rules. 

How can Businesses and Foreign Investors Prepare for the New Rules? 

Businesses, FPIs, and FVCIs should review their compliance processes before the new SEBI rules come into effect. This will help them adapt to the new rules and avoid unnecessary delays in the future. 

The following steps can be followed to prepare- 

•      Review internal compliance procedures.
•      Update accounting systems to INR-based fee payments.
•      Train the compliance team on the new rules.
•      Maintain regular coordination with DDPs and custodians.
•      Revise the registration checklist as per the new rules.
•      Regularlymonitorthe implementation timeline set by SEBI. 

Preparing in advance will make the compliance process much easier when the new rules come into effect. 

How Can Enterslice Help in Complying with the New SEBI FPI Rules? 

Maintaining proper compliance as per the new SEBI FPI Rules can be a challenge for many organizations. Enterslice helps businesses comply with the regulations with ease by providing professional assistance throughout the process. 

Enterslice’s assistance includes- 

•      Assistance in the entire process of FPI registration.
•      Assistance in preparing the required regulatory documentation.
•      Compliance advisory as per the new SEBI norms.
•      Assistance in preparing the Common Application Form (CAF) correctly.
•      Guidance on PAN-related documentation.
•      Assistance in necessary coordination with DDPs.
•      Timely filing support and updates on new regulatory changes.
•      Assistance in avoiding common compliance errors, incomplete documents, and unnecessary delays.

Enterslice’s experienced team guides businesses from start to finish. We help businesses follow the new SEBI norms and reduce compliance risks. 

To Wrap Up  

SEBI’s decision to introduce an INR-based registration fee is an important step in simplifying and modernizing the regulatory framework of the Indian capital markets. This amendment will reduce administrative complexity, make fee collection more transparent, and make the entire compliance process more efficient. 

While the core investment process remains unchanged, firms, FPIs, FVCIs, DDPs, and custodians should use the six-month transition period to prepare their systems and processes to comply with the new rules. 

Enterslice can provide professional support to your organization in meeting FPI registration, documentation, compliance, and ongoing SEBI regulatory requirements. Compliance with the new rules becomes much easier and more effective with proper planning and expert support.  

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