SEBI Proposes Tighter Rules For Online Bond Platform Advertisements
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SEBI has proposed stricter advertising norms for Online Bond Platform Providers, including disclosures on pricing, yield and credit risk, while seeking to curb claims that could suggest assured returns.
The Securities and Exchange Board of India (SEBI) has put forward an amended advertising code for Online Bond Platform Providers (OBPPs). The intent is to increase transparency in promotional content and to prohibit exaggeration that could influence investors' decisions without proper due diligence.
The regulator issued the consultation paper on 21 August 2026, and has invited comments from stakeholders until 11 September.
What Rules Could Apply To ‘Fixed Returns’ Claims?
Under the proposal, OBPPs could continue using terms such as “fixed returns” and “predictable returns”, but advertisements using these terms would have to clearly state that fixed returns are not guaranteed.
The proposed warning would also have to state that investments in debt securities are subject to market, credit and default risks. The warning would need to be displayed in at least 10-point font and use the prescribed wording without changes.
SEBI has also proposed restrictions on terms such as “high-yield”, “high-rated” and “high returns” when used without an adequate basis.
What Information Would Bond Advertisements Need To Show?
Advertisements for securities available through online bond platforms would need to provide standardised information about the security. This would include the issuer, tenor, credit rating, nature of the instrument, clean price, dirty price and yield to maturity.
The proposed disclosures would also include the credit risk-o-meter, giving investors additional information about the credit risk associated with the security being promoted.
The proposed code would allow phrases such as “returns are predictable” and “passive income” provided they are used in a general manner and do not imply assured or guaranteed returns.
Where advertisements show a range of returns, the proposal says the range should be presented in the same font size and format. Platforms would not be allowed to highlight only the higher end of the range.
For Principal Protected Market Linked Debentures, advertisements would also need risk disclosures and would have to clarify that these instruments do not offer fixed or assured returns.
Why Is SEBI Reviewing The Advertising Code?
SEBI has raised concerns about advertisements that create a sense of urgency or use fear-of-missing-out (FOMO) messages as these could tempt investors into making decisions without proper verification.
The proposed code would replace the existing Advertisement Code applicable to OBPPs and operate alongside SEBI's Common Advertisement Code for regulated entities. The current rules require advertisements to be accurate, fair, clear and concise and prohibit false or misleading statements, exaggerated slogans and language that could confuse investors.
The proposal comes after SEBI had taken steps to widen retail participation in corporate bonds. In 2024, the regulator reduced the minimum bond investment ticket size from ₹1 lakh to ₹10,000. In October 2022, it reduced the face value of corporate bonds to ₹1 lakh from ₹10 lakh.
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This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
Vishwa has spent 10+ years across fintech and FMCG doing what most people miss, connecting the dots, catching trends before they trend, and finding the angle nobody else thought to ask about.
At Kotak Neo, she drives content strategy for neoshorts, Kotak News Desk, and Investing Guide, turning market noise into something worth reading.
When she's not decoding markets, she trades charts for canvases, chasing art, painting, and architecture across cities she's yet to explore.
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