SEBI has introduced a mandatory Credit Risk-o-Meter for debt securities to provide a colour-coded visual indication of credit risk before investment.
The Securities and Exchange Board of India (SEBI) has introduced a Credit Risk-o-Meter as an additional disclosure mechanism for debt securities.
The new disclosure is intended to help investors assess the credit risk associated with a debt security through a colour-coded format before investing.
The Credit Risk-o-Meter will be mandatory in the following:
- Offer documents
- Abridged prospectuses
- Private placement memorandums
- Advertisements issued by issuers and Online Bond Platform Providers (OBPPs)
- Websites and mobile platforms of OBPPs
SEBI has also added the Credit Risk-o-Meter to the minimum disclosure requirements for securities offered through Online Bond Platforms. Details of the issuer, security name and ISIN will now be accompanied by the Credit Risk-o-Meter in the format specified by SEBI.
The detailed framework for the disclosure has been provided in Annexure A of the circular. SEBI will also insert a new chapter in its Master Circular for issue and listing of non-convertible securities and other specified debt instruments.
What does this mean for you?
The Credit Risk-o-Meter will provide a visual indication of the credit risk of a debt security at the time the security is presented to you. This can make the relevant credit-risk information easier to identify before you consider an investment.
The new requirements will come into force 45 days from the date of the circular, which was issued on 7 October 2026.
Stock exchanges and depositories have been directed to put the necessary systems and processes in place for implementation.
Source: Securities and Exchange Board of India (SEBI), Circular dated 7 October 2026
