?||What is Social Stock Exchange?||
India is estimated to need over USD 2.6 trillion in investment to meet the UN Sustainable Development Goals by 2030. Capital is also a key requirement if India were to substantially improve its abysmal Human Development Index rank of 129 out of 189 countries. However, with Indias structural fiscal deficit, raising capital to solve for social problems is a Herculean task, especially in the post Covid scenario.
So, what is the answer? Well, one possibility is the Social Stock Exchange (SSE) mooted by the central government and the SEBI. The proposed SSE in India would be an electronic fund-raising platform, where both for-profit social enterprises (FPEs) and non-profit social enterprises (NPOs) would be allowed to list and raise various kinds of risk capital (including debt and equity) from a variety of domestic and international funders, similar to a regular stock exchange but only for a social cause.
SSEs are not new internationally, with Brazil (2003), South Africa (2006), the UK, Canada, Singapore (all in 2013) and other countries having established them. Spurred by the budget proposal of Finance Minister Nirmala Sitharaman in July 2019, a SEBI appointed Working Group has recently released a draft report on the SSE which outlines the fund raising mechanisms for the social sector and the associated regulatory framework covering eligibility norms for listing, disclosures and trading. Comments on the draft Working Group report were to be submitted latest by August 15.
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?||What is Social Stock Exchange?|| India is estimated to need over USD 2.6 trillion in investment to meet the UN Sustainable Development Goals by 2030. Capital is also a key requirement if India were to substantially improve its abysmal Human Development Index rank of 129 out of 189 countries. However, with Indias structural fiscal deficit, raising capital to solve for social problems is a Herculean task, especially in the post Covid scenario. So, what is the answer? Well, one possibility is the Social Stock Exchange (SSE) mooted by the central government and the SEBI. The proposed SSE in India would be an electronic fund-raising platform, where both for-profit social enterprises (FPEs) and non-profit social enterprises (NPOs) would be allowed to list and raise various kinds of risk capital (including debt and equity) from a variety of domestic and international funders, similar to a regular stock exchange but only for a social cause. SSEs are not new internationally, with Brazil (2003), South Africa (2006), the UK, Canada, Singapore (all in 2013) and other countries having established them. Spurred by the budget proposal of Finance Minister Nirmala Sitharaman in July 2019, a SEBI appointed Working Group has recently released a draft report on the SSE which outlines the fund raising mechanisms for the social sector and the associated regulatory framework covering eligibility norms for listing, disclosures and trading. Comments on the draft Working Group report were to be submitted latest by August 15.