Minimum fund flows

Registration on a Social Stock Exchange is meant to be a mark of quality. A body with almost no track record cannot carry that mark.

So SEBI sets a size test. The workbook calls it minimum fund flows. It has two limbs, and both are measured over the past financial year:

• the NPO must have spent at least ₹50 lakh; and
• it must have received at least ₹10 lakh in funding.

Neither figure may be asserted. Both must come out of audited accounts or a fund flow statement.

The workbook is open about why the test exists. The idea is to make sure an NPO seeking registration has an adequate track record of operations. Size here is a proxy for experience, not a judgement about worth.

Where it sits. Minimum fund flows is one broad parameter inside Table 3.1, Mandatory Criteria for NPO Registration, read with Regulation 292F(1) of the SEBI (ICDR) Regulations, 2018. The other parameters are legal requirements, not size.

The rest of Table 3.1, for context. The NPO must be registered in India as a charitable trust, a charitable society or a Section 8 company; its registration certificate must be valid for at least the next 12 months at the time it seeks SSE registration; its Income Tax exemption certificate under section 12A / 12AA / 12AB / 10(23C) / 10(46) must likewise be valid for at least the next 12 months; it must hold a valid IT PAN and valid 80G registration; it must be at least 3 years old; and it must meet the requirements of Regulation 292E. Pending notices or scrutiny cases must be disclosed, and any fine or penalty disclosed as paid or appealed within 7 days. The exchanges may refuse registration where such cases are grave enough to endanger the NPO's registration under the Income-tax Act.

What registration buys. Chapter 3 says NPO registration serves a three-fold purpose: it brings NPOs onto a common platform of legal requirements; it shifts them towards disclosure-driven fundraising; and it lets them signal the primacy of their social impact and the quality of their governance even if they list nothing. That signalling value — the workbook's reputation value — is why the size test matters even to an NPO that never raises a rupee on the exchange.

Registration without raising funds. SEBI's circular of April 15, 2026 allows a registered NPO not to raise funds for two years from registration, extendable by one further year with the exchange's approval.

Illustrative NPOs; the ₹50 lakh and ₹10 lakh thresholds are the workbook's.

Three trusts apply to register on BSE SSE. All three are more than 3 years old and hold valid 12AB and 80G certificates. Their audited accounts for the past financial year show:

Two points follow.

Both limbs bind. Bal Kiran and Sanjeevan each pass one limb and fail the other, and each fails the test. A big spender that raised almost nothing last year is as much outside the criteria as a well-funded body that barely spent.

Bal Kiran's near miss is fixable, and honestly so. It spent ₹47,00,000 last year. If this year's audited payments come to, say, ₹56,00,000 against funding of ₹51,00,000, it clears both limbs and can apply on those accounts. What it cannot do is present unaudited figures — the criteria name audited accounts or a fund flow statement as the source.

Chapter 3 (Registration and Listing on Social Stock Exchanges, 15% weightage), section 3.1.2.2 and Table 3.1, sets the mandatory criteria and the two fund-flow figures. This is one of the paper's most reliably examined number pairs. Expect: what is the minimum annual spending for NPO registration (₹50 lakh), the minimum funding (₹10 lakh), over what period (the past financial year), and from what source (audited accounts or a fund flow statement). The neighbouring numbers — 3 years of age and 12 months of certificate validity — are examined in the same breath, so learn all four together.

• ₹50 lakh is spending; ₹10 lakh is funding. Swapping them is the single most common error, because the larger figure intuitively looks like the money coming in.
• Both limbs must be met. Passing one does not carry the other.
• "At least" means the threshold counts. Spending of exactly ₹50 lakh clears the test.
• Past financial year, from audited accounts. Not a projection, not the current year to date, not management accounts.
• Minimum fund flows is a size test, not a legal-status test. Age (3 years), registration form, 12AB and 80G validity are separate rows of the same table.
• Registration does not oblige an NPO to raise money. Under the April 15, 2026 circular it may stay registered without raising funds for 2 years, extendable by 1 year with the exchange's approval — but on expiry it must have at least one listed project or it ceases to be registered.
• Do not confuse this with investable funds or with the predominance test, which asks what share of activity serves the target population rather than how large the NPO is.