Module 16: Social stock exchanges

A social stock exchange is a segment of a stock exchange where social enterprises raise money for work with a social purpose. SEBI set up the framework, and NSE and BSE run the segments. This module explains how it works.

01What it is for

To give organisations working on social causes a regulated, transparent way to raise funds from the public, with reporting on what the money achieved.

02Who can raise money

Not-for-profit organisations and for-profit social enterprises that meet SEBI's eligibility criteria and are registered on the exchange's social segment.

03How not-for-profits raise money

Through instruments such as zero coupon zero principal bonds: the contributor receives no return of money, only the outcome of the project funded.

04How for-profit social enterprises raise money

Through the regular routes, equity and debt, with the added obligation to report their social impact.

05Impact reporting

Organisations report what was done with the money and what changed, assessed against stated goals. The reporting is what sets the segment apart.

06Who takes part

Individuals, institutions and companies, including those meeting corporate social responsibility obligations, can fund listed projects within the rules of the segment.

07Things to understand before contributing

A contribution to a not-for-profit project is closer to a donation than an investment. Read the project, the organisation and the impact report.

08Where this leads

This module is for understanding the segment; A1Stock does not recommend any listing.