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Corporate Laws Central Ministry of Finance Securities and Exchange Board of India Act, 1992

SEBI issues Guidelines for Custodians

04-Mar-2026 | HO/19/(1)2025-AFD-FPICELL/I/5928/2026

SEBI has issued a circular specifying the conditions and modalities for complying with the amended provisions relating to net worth requirements, rendering of financial services, and the obligations and responsibilities of custodians. These provisions will become effective from 24th March, 2026.

This circular has been issued pursuant to the previously issued Securities and Exchange Board of India (Custodian) (Amendment) Regulations, 2025, dated 18th September, 2025.

By virtue of this circular, the following has been specified:

a. The list of activities that can be carried out by custodians in relation to the rendering of financial services will be specified by the Custodians and DDPs Standards Setting Forum (CDSSF), in consultation with SEBI. (Para 2.1.1)

b. Custodians are required to prepare and maintain separate accounts for each Separate Business Unit (SBU). Further, the net worth requirement must be complied with after excluding the books and accounts of the SBUs. (Para 2.1.2)

c. Custodians are permitted to outsource only non-core activities and are not allowed to outsource their core business activities or compliance functions. (Para 3.1)

d. Custodians holding any physical securities are required to maintain a vault/safe or equivalent storage facility. They are also required to mandatorily submit the specifications of the vault, along with its size, as part of their quarterly report. (Para 4.2)

Kindly refer to the attached document for more information.

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