On December 16, 2024, SEBI notified the Securities and Exchange Board of India (Investment Advisers) (Second Amendment) Regulations, 2024, effective immediately.
If you’ve researched becoming a Registered Investment Adviser (RIA) any time before this date, much of what you read is now outdated.
This amendment didn’t just tweak a few rules — it meaningfully lowered the entry barrier, restructured the net worth requirement, and introduced an entirely new category of adviser.
Here’s a complete, plain-language breakdown of exactly what changed and what it means if you’re considering this career path.
Why This Reform Happened
India has a striking imbalance in its wealth management ecosystem: fewer than 1,000 SEBI-registered investment advisers serve a market of over 20 crore investors — roughly one regulated, fee-only fiduciary advisor for every two million investors.
Meanwhile, assets under portfolio management services alone crossed ₹35 lakh crore in early 2025.
SEBI’s December 2024 amendment was designed specifically to close this gap by making RIA registration meaningfully more accessible, without compromising investor protection standards.
Change 1: Simpler Qualification Requirements
Previously, becoming an RIA required a postgraduate degree and several years of relevant professional experience — a genuinely significant barrier for many capable candidates. Under the December 2024 amendment:
- A graduate degree is now sufficient, with no postgraduate requirement.
- The prior experience requirement has been removed entirely.
- Candidates must still hold the required NISM Series X-A and X-B certifications.
This single change dramatically widens the pool of people who can realistically pursue RIA registration, particularly younger finance professionals who previously had to wait years to qualify.
Change 2: Net Worth Requirement Replaced with a Deposit-Based System
This is arguably the most impactful change for anyone weighing whether RIA registration is financially feasible. The old regulations required advisers to maintain a significant minimum net worth. The amendment scraps this entirely, replacing it with a graded deposit system based on how many clients you actually serve:
- The deposit amount is tied to the maximum number of clients you had on any single day in the previous financial year — meaning smaller practices face a much lower financial barrier than under the old net-worth rule.
- Deposit slabs generally range from ₹1 lakh to ₹10 lakh, increasing as client count rises.
- The deposit must be maintained with a scheduled bank as a fixed deposit, marked under lien in favour of the IAASB (Investment Adviser Administration and Supervisory Body, administered by BSE Ltd).
- A subsequent SEBI circular (dated August 12, 2025) expanded this further, allowing advisers to also maintain the required deposit using liquid mutual fund or overnight mutual fund units under lien, rather than only a fixed deposit.
For someone starting out with a modest client base, this shift can mean the difference between needing several lakhs in net worth and needing just ₹1 lakh in a lien-marked deposit—a genuinely transformative change for accessibility.
Change 3: A New “Part-Time Investment Adviser” (PTIA) Category
The amendment introduces an entirely new registration category: the Part-Time Investment Adviser (PTIA).
This allows professionals to register as an investment adviser while continuing other non-conflicting work — a meaningful shift from the earlier framework, which effectively expected RIA registration to be a full-time commitment.
Key conditions for this category:
- PTIAs are capped at serving a maximum of 75 clients at a time.
- The role is explicitly designed for professionals who want to offer advisory services alongside another career, rather than as their sole occupation.
This creates a genuinely new, lower-commitment entry point into investment advisory — useful for financial professionals, educators, or other domain experts who want to offer advice without transitioning to a full-time advisory practice.
Change 4: “Trading Calls” Clarified as Not Investment Advice
The amendment specifically clarifies that “trading calls” do not qualify as investment advice under the regulatory definition.
This distinction matters because it affects who needs to register as an RIA in the first place — helping separate casual trading tips or signals from the more comprehensive, personalised advisory relationship that RIA regulations are designed to govern.
Change 5: More Flexibility on Compliance Officers
Previously, non-individual (corporate) investment advisers were required to appoint an in-house compliance officer.
Under the amended rules, this is no longer mandatory. Instead, non-individual IAs can appoint independent professionals — members of ICAI, ICSI, ICMAI, or other SEBI-specified professional bodies — provided they hold the relevant NISM certification.
This gives smaller advisory firms more flexibility in meeting compliance obligations without necessarily hiring a dedicated in-house role.
Change 6: Mandatory Disclosure of AI Tool Usage
With AI tools increasingly used in financial analysis and advisory workflows, the amendment introduces a disclosure requirement: if an investment adviser uses AI tools to generate advice, it must disclose that usage to the client.
Importantly, responsibility for the advice always remains with the individual or entity IA, regardless of how much the advice relied on an AI tool — a clear signal that SEBI views AI as a tool to support advisers, not a way to diffuse accountability.
Change 7: Threshold for Moving to Non-Individual Status
The amendment also clarifies when an individual RIA must transition to a non-individual (corporate) registration: once an adviser crosses 300 clients or ₹3 crore in annual advisory fees, they must restructure as a non-individual entity.
This threshold gives growing individual practices a clear, predictable point at which they need to formalise into a more structured corporate setup.
Compliance Timeline
SEBI initially expected advisers to align with several of these new requirements quickly after the December 2024 notification, but practical rollout took time — the compliance deadline for both Investment Advisers (IAs) and Research Analysts (RAs) to fully align with the new deposit and related requirements was ultimately extended to September 30, 2025, giving the industry additional time to adjust systems, agreements, and disclosures.
What This Means If You’re Considering Becoming an RIA
Taken together, these changes make 2026 a meaningfully better time to consider RIA registration than just a couple of years ago:
- Lower financial barrier to entry, thanks to the deposit-based system replacing net worth requirements
- Lower educational and experience barrier, with a graduate degree now sufficient
- A genuine part-time pathway via the PTIA category, for those not ready to commit full-time
- Somewhat lighter compliance overhead for smaller non-individual practices, given the more flexible compliance officer rules
SEBI RIA Rules: Before vs After December 2024
| Requirement | Before December 2024 | After December 2024 Amendment |
| Minimum Education | Postgraduate degree | Graduate degree sufficient |
| Prior Experience | Required (multi-year) | Removed entirely |
| Financial Requirement | Minimum net worth | Graded deposit (Rs.1 lakh – Rs.10 lakh, by client count) |
| Deposit Instrument | Not applicable | Bank FD, or liquid/overnight MF units under lien (from Aug 2025) |
| Part-Time Option | Not available | PTIA category introduced (max 75 clients) |
| Compliance Officer (Non-Individual IA) | Mandatory in-house | Can appoint independent certified professionals |
| AI Usage in Advice | Not addressed | Must be disclosed to clients |
| Threshold to Go Non-Individual | Not clearly defined | 300 clients or Rs.3 crore in annual fees |
Frequently Asked Questions
When did SEBI’s new RIA rules come into effect?
The Securities and Exchange Board of India (Investment Advisers) (Second Amendment) Regulations, 2024, were notified on December 16, 2024, and came into effect immediately, though certain compliance requirements had extended deadlines, with a key deadline of September 30, 2025.
Do I still need a postgraduate degree to become an RIA?
No. The December 2024 amendment made a graduate degree sufficient, removing the earlier postgraduate requirement.
What is a Part-Time Investment Adviser (PTIA)?
A new category introduced by the amendment, allowing professionals to register as an investment adviser while continuing other non-conflicting work, capped at a maximum of 75 clients at a time.
How much deposit do I need to maintain as an RIA now?
Deposit requirements are graded based on your maximum client count in the previous financial year, generally ranging from ₹1 lakh to ₹10 lakh, maintained as a bank fixed deposit or, since August 2025, liquid/overnight mutual fund units under lien in favour of the IAASB.
Can I use AI tools to help provide investment advice?
Yes, but you must disclose this usage to your clients, and you remain fully responsible for the advice given, regardless of AI involvement in generating it.