SEBI Eases FPI KYC Rules from December 1, 2026, reducing repetitive compliance requirements for eligible foreign portfolio investors operating in Indian markets.
The Securities and Exchange Board of India (SEBI) has extended the periodic Know Your Customer (KYC) review cycle from the existing one or three years to two or eight years, depending on the investor’s category and jurisdiction.
The revised framework is intended to make compliance simpler for foreign investors while reducing repeated documentation and verification requirements.
SEBI announced the changes through a circular issued on October 30, 2026.
SEBI Eases FPI KYC Rules: New Review Periods
Under the revised framework, the KYC review frequency will depend on whether an investor belongs to Category I or Category II and whether the investor operates from a high-risk or non-high-risk jurisdiction.
Category I FPIs from non-high-risk jurisdictions will undergo KYC reviews once every eight years instead of every three years.
For Category I FPIs from high-risk jurisdictions, investors registered under Regulation 5(a)(i) will also receive an eight-year review cycle.
Other Category I investors from high-risk jurisdictions will have to complete KYC reviews every two years.
For Category II FPIs from non-high-risk jurisdictions, regulated entities will undergo reviews every eight years. Other Category II investors in this group will continue with a two-year review cycle.
Category II FPIs from high-risk jurisdictions will also be subject to KYC reviews every two years.
Which Foreign Investors Will Continue With Existing Rules?
SEBI has clarified that the existing arrangements for certain special categories of foreign portfolio investors will remain unchanged.
Foreign Portfolio Investors investing exclusively in government securities, known as GS-FPIs, will continue to follow the KYC review frequency applicable to their respective bank accounts under Reserve Bank of India guidelines.
Similarly, investors registered under the SWAGAT-FI framework will retain their existing 10-year KYC review cycle. The new changes will not alter these arrangements.
The revised framework therefore provides longer review periods to specified investor categories rather than applying a uniform eight-year cycle to every foreign portfolio investor.
 SEBI Removes Separate No-Change Declaration Requirement
Another important change is the removal of a separate requirement for FPIs to report changes in previously submitted information or provide a no-change declaration when continuing their registration.
Earlier, foreign investors had to provide confirmation about changes in information submitted previously or declare that no changes had occurred at the time of registration continuance.
SEBI has now discontinued this separate requirement. The regulator noted that FPIs are already required to update relevant information under existing regulatory provisions, making the additional declaration repetitive.
However, this does not remove the obligation to keep information updated under applicable rules. FPIs must continue to comply with other reporting and disclosure requirements.
Registration Continuance Fee Deadline Remains Important
SEBI has also specified the payment timeline for investors seeking to continue their registration.
FPIs wishing to continue registration for the next three-year block must pay the applicable fee to their Designated Depository Participant (DDP). For SWAGAT-FI investors, the registration period is 10 years.
The payment must be completed at least 15 days before the expiry of the existing registration validity. This requirement is intended to help ensure a smooth continuation process.
Depositories, custodians and Designated Depository Participants have been directed to make the necessary changes to their systems and processes and inform the concerned foreign investors.
The revised provisions will come into effect from December 1, 2026.
The changes are part of SEBI’s broader effort to reduce repetitive regulatory procedures and make participation in Indian capital markets more convenient for foreign investors.
