SEBI Establishes Net Settlement Framework for FPI Cash Market Transactions

The Securities and Exchange Board of India (SEBI) issued a circular on April 24, 2026, detailing the framework for the net settlement of funds for Foreign Portfolio Investors (FPIs). This framework specifically applies to transactions executed within the cash market segment. Under the new guidelines, the settlement of funds for foreign entities will be processed on a net basis, consolidating payable and receivable amounts across transactions.

The mandate is grounded in SEBI’s statutory objectives to protect the interests of investors in securities and to regulate the development of the securities market. The framework covers matters connected with or incidental to the settlement of funds for FPIs. Implementation is set for April 24, 2026, requiring market intermediaries and foreign investors to align their cash market transaction protocols with these net settlement requirements.