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      Question

      As per the Social Stock Exchange Framework issued by

      SEBI, N on-profit organisations (N POs )   a re NOT  permitted  to raise funds through which of the following instruments?  
      A Equity Correct Answer Incorrect Answer
      B Grants Correct Answer Incorrect Answer
      C Zero-coupon zero-principal bonds Correct Answer Incorrect Answer
      D Mutual Funds Correct Answer Incorrect Answer
      E All are permitted Correct Answer Incorrect Answer

      Solution

      According to the Social Stock Exchange Framework issued by the Securities and Exchange Board of India (SEBI), Non-Profit Organizations (NPOs)  are allowed to raise funds  mainly through :  

      • Zero-Coupon Zero-Principal (ZCZP) bonds  
      • Donations  and  Grants  via Mutual fund schemes  
        These instruments  d o not provide ownership  and d o not  create  repayment  obligation  and as such are s uit ed to the  non-profit nature  of the NPOs.     The framework specifically excludes  Equity  as a source of raising funds as  eq uity implies ownership/ shareholding  and  NPOs have no owners or shareholders .  

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