SEBI shifts FPI registration fees from dollar to rupee, effective in 6 months
Synopsis
SEBI is replacing its dollar-based FPI fee structure with rupee equivalents — ₹90,000 for standard registration and ₹2.3 lakh for Category-I investors — citing manual accounting gaps and reporting delays. With $12.98 million collected in FY2025-26 alone, this restructuring touches a significant revenue stream and signals a push for tighter, real-time regulatory oversight of foreign capital flows into India.
Key Takeaways
SEBI has amended FPI Regulations to replace US dollar fees with rupee-denominated equivalents, effective after six months .
Standard registration fee revised from $1,000 to ₹90,000 ; Category-I FPI and FVCI fee revised from $2,500 to ₹2.3 lakh .
Custodian fee structure changed from an annual payment of ₹10 lakh to a monthly payment of ₹85,000 .
DDPs must remit collected fees to SEBI within five working days of granting registration.
SEBI collected $12.98 million (including GST) in FPI and FVCI fees during FY2025-26 .
PAN application process simplified by including date of birth or incorporation in the common FPI registration form, aligned with a CBDT notification from March .
The Securities and Exchange Board of India (SEBI) has notified amendments to the Foreign Portfolio Investors (FPI) Regulations, replacing the existing US dollar-denominated fee structure with a rupee-denominated payment mechanism for foreign portfolio investors and foreign venture capital investors (FVCIs). The revised framework will come into effect after six months, providing foreign investors and intermediaries sufficient time to adapt to the new system.
Key Changes in Fee Structure
Under the amended regulations, the existing registration fee of $1,000 has been replaced with ₹90,000 in eligible foreign exchange equivalent. The registration fee for Category-I FPIs and FVCIs has been revised upward from $2,500 to ₹2.3 lakh. SEBI has similarly revised the late fee and continuance fee under the new rupee-denominated framework.
Additionally, the regulator has overhauled the fee payment mechanism for custodians, replacing the earlier annual payment of ₹10 lakh with a monthly payment of ₹85,000 — a structural shift aimed at improving cash flow predictability and accounting accuracy.
Why SEBI Made the Switch
SEBI stated that the move to a rupee-denominated fee structure directly addresses operational challenges embedded in the dollar-based system, including manual accounting and invoicing processes, the absence of real-time accounting visibility, and recurring delays in financial reporting. The transition is designed to streamline back-office operations for both the regulator and designated depository participants (DDPs).
Notably, SEBI collected $12.98 million — including GST — during financial year 2025-26 from registration, continuation, and other fees paid by FPIs and FVCIs, underscoring the scale of the revenue stream now being restructured.
Role of Depository Participants and PAN Integration
Under the amended rules, designated depository participants (DDPs) will be required to remit fees collected from FPIs and FVCIs to SEBI within five working days of granting registration — tightening the existing remittance timeline.
SEBI has also simplified the registration process by mandating the inclusion of the date of birth or date of incorporation in the common application form for FPI registration. This change is aimed at facilitating Permanent Account Number (PAN) applications in line with a notification issued by the Central Board of Direct Taxes (CBDT) in March.
What This Means for Foreign Investors
The six-month transition window gives foreign investors and their intermediaries adequate runway to update internal systems, renegotiate fee agreements, and align accounting workflows with the rupee-denominated structure. This is part of a broader SEBI effort to reduce friction in cross-border capital flows while tightening domestic compliance visibility.
With India's capital markets attracting sustained FPI interest, the move signals that SEBI is prioritising operational efficiency and regulatory oversight alongside market openness. The next step will be watching how quickly DDPs and custodians adapt their systems ahead of the implementation deadline.
Point of View
Not just simplifying them. The broader question is whether this operational tidying-up will translate into faster, more transparent FPI grievance resolution — something foreign investors have flagged for years.
NationPress
8 Jul 2026
Frequently Asked Questions
What changes has SEBI made to FPI registration fees?
SEBI has replaced the US dollar-denominated FPI registration fee structure with rupee equivalents. The standard fee moves from $1,000 to ₹90,000, while the Category-I FPI and FVCI fee rises from $2,500 to ₹2.3 lakh. The changes take effect after six months.
Why is SEBI switching from dollar to rupee fees for FPIs?
SEBI cited operational challenges with the dollar-based system, including manual accounting and invoicing, lack of real-time accounting visibility, and delays in financial reporting. The rupee structure is intended to streamline these processes and improve regulatory oversight.
When will the new SEBI FPI fee structure come into effect?
The amended regulations will come into effect after six months from the date of notification, giving foreign investors, DDPs, and custodians time to transition their systems and workflows.
How are custodian fees changing under the new SEBI rules?
SEBI has replaced the annual custodian fee of ₹10 lakh with a monthly payment of ₹85,000, restructuring the payment cadence to improve cash flow predictability and accounting accuracy for both custodians and the regulator.
How much did SEBI collect in FPI fees in FY2025-26?
SEBI collected $12.98 million, including GST, during financial year 2025-26 from registration, continuation, and other fees paid by FPIs and FVCIs — the revenue stream now being restructured under rupee denomination.
