SEBI’s GARUDA Framework Cuts AIF Scheme Launch Time to 10 Days

The Securities and Exchange Board of India (SEBI) has rolled out a new framework called GARUDA that significantly cuts the time for alternative investment funds (AIFs) to launch new schemes. Under the green-channel mechanism, AIFs can now bring regular schemes to market within ten working days of filing their private placement memorandum (PPM) with the regulator, provided no objection is raised.

What is the GARUDA framework?
GARUDA stands for Green-channel: AIF Rollout Upon Document Acknowledgement. It replaces the earlier requirement where AIFs had to wait for SEBI’s review of their PPM before launching a scheme. The new process places greater reliance on disclosures, certifications and the accountability of fund managers, moving from pre-launch scrutiny to post-facto supervision.

Por que importa

Key Data
| Aspect | Details |
|——–|———|
| Regular scheme launch | Within 10 working days of PPM filing via registered merchant banker |
| Newly registered AIF | First scheme after SEBI registration or 10 days after PPM filing, whichever later |
| LVFs, AIoFs, angel funds | Exempt from merchant banker filing; can launch immediately after filing with SEBI |
| Effective date | Immediately upon circular release (July 30, 2026) |

Lighter treatment for specialised funds
The circular also provides regulatory relief for large value funds (LVFs), accredited investor-only funds (AIoFs) and angel funds. These vehicles are exempt from filing their PPM through a merchant banker and can launch a scheme immediately after submitting the document to SEBI themselves. For first-time LVFs and AIoFs, launches can begin from the date SEBI registration is granted. Angel funds receive the same relaxation and can circulate their PPM for soliciting funds from the date of registration.

Strict naming and compliance rules
To maintain clarity, SEBI has mandated that AIoF schemes must append “AI only fund” or “AIOF” to their official name, while LVFs must include “LVF” in their scheme title. Merchant bankers remain responsible for omissions or misleading statements in the PPM, and a formal due diligence certificate along with “fit and proper” declarations and PAN details of key leadership must be submitted on the SEBI intermediary portal.

Impact on startup funding
AIFs are a major source of capital for Indian startups, particularly through venture capital funds. By reducing the time to launch new schemes, the GARUDA framework could enable faster deployment of capital into startup rounds. The lighter treatment for angel funds and accredited investor funds may also encourage more tailored investment vehicles for early-stage and high-net-worth investors. However, the regulator has clarified that filing the PPM does not imply SEBI approval, and enforcement will shift to post-launch oversight.

Source: Inc42, https://inc42.com/buzz/sebi-rolls-out-garuda-framework-to-expedite-fund-launches/

Datos clave

Punto	Detalle
Fuente	Inc42
Fecha	2026-07-30T19:52:15+00:00
Tema	SEBI Rolls Out ‘GARUDA’ Framework To Expedite Fund Launches