Corporate Bonds for You: SEBI's 2.5% Fee Cap Explained

SEBI wants to bring corporate bonds to regular investors by creating a new network of channel partners — similar to mutual fund distributors — with fees capped at 2.5%. This could finally make bond investing accessible to salaried Indians.

Here's what happened: SEBI has proposed a new category of intermediaries called Fixed Income Channel Partners to distribute corporate bonds directly to retail investors across India.. These channel partners will function similarly to Mutual Fund Distributors (MFDs), with stock exchanges responsible for enlisting them and bond platforms supervising their conduct.. A fee cap of 2.5% has been proposed on what these channel partners can earn, aimed at curbing mis-selling and protecting retail investors from overpriced recommendations..

What you should do: Check SEBI-registered Online Bond Platform Providers (OBPPs) like IndiaBonds or GoldenPi to start exploring listed corporate bonds before this channel even launches.. Compare your current FD rate against AA-rated or AAA-rated corporate bond yields — if the spread is 1.5% or more, bonds deserve a place in your portfolio.. Avoid unlisted corporate bonds sold informally by small agents — only buy through SEBI-registered platforms where grievance redressal is clearly defined..

Pro tip: Corporate bonds held in your demat account are subject to TDS at 10% on interest above ₹5,000 annually — factor this into your post-tax yield comparison with FDs before switching.

For readers weighing their credit and loan options, our personal loan guide and CIBIL score resources put this update in context.