SEBI Extends Deadline for Angel Funds to Disclose Investment Allocation Methodology to January 31, 2026

The deadline for Angel Funds to reveal their investment allocation process in Private Placement Memorandums (PPMs) has been extended by the Securities and Exchange Board of India (SEBI) to January 31, 2026. The circular, which was issued on October 15, 2025, gives fund managers more time to update documents and set up open procedures for allocating investments.

Compliance Extension for Angel Funds

Under SEBI's Alternative Investment Funds (AIF) Regulations, 2012, angel funds—a subset of venture capital funds—collect money from angel investors to help start-ups and new businesses in their early stages. Before October 15, 2025, SEBI required these funds to reveal a precise process for distributing investments among investors who approved a certain investment plan.  In response to industry concerns, the regulator has now extended this deadline to provide more time to comply.

SEBI’s Ongoing Regulatory Reforms

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In order to improve governance, accountability, and transparency in Angel Fund operations, SEBI has implemented a number of regulatory steps in recent months. The regulator first announced changes to the AIF Regulations on September 9, 2025. On September 10, a comprehensive circular detailing the updated framework for Angel Funds was released. The September circular's paragraph 8.3 mandated that all funds in existence provide a comprehensive explanation of their investment allocation approach in their PPMs. Furthermore, the declared allocation approach had to be closely followed for any investments made after the preceding October 15 deadline.

Industry Feedback and Rationale for Extension

Concerns expressed by fund managers and other AIF industry participants led SEBI to decide to extend the deadline. In order to update their PPMs and put in place reliable internal allocation processes, many stakeholders asked for more time. The regulator granted a three-and-a-half-month extension after taking these representations into account, guaranteeing that all Angel Fund investments made after January 31, 2026, will adhere to the specified and declared approach.

The extension underscores SEBI’s approach to balancing regulatory oversight with industry feasibility, enabling Angel Funds to align with compliance requirements without disrupting investment operations.

Conclusion

In summary, SEBI’s extension of the deadline to January 31, 2026, provides Angel Funds with the necessary time to revise their PPMs and implement transparent allocation methodologies. This move aims to strengthen governance, protect investor interests, and support the orderly growth of early-stage investment activities in India.