The Securities and Exchange Board of India (SEBI) has made it mandatory for compliance officers of Alternative Investment Fund (AIF) managers to obtain certification from the National Institute of Securities Markets (NISM).
In a circular issued on Tuesday, SEBI said that compliance officers must clear the NISM Series III-C: Securities Intermediaries Compliance (Fund) Certification Examination. The requirement stems from a notification issued by NISM on November 20, 2025.
SEBI clarified that from January 1, 2027, only individuals holding this certification will be eligible to be appointed as compliance officers of AIF managers or continue in the role. This effectively provides the industry with a transition period of one year to align existing compliance personnel with the new regulatory requirement.
Under the AIF Regulations, fund managers are required to appoint a compliance officer, and SEBI has the authority to prescribe eligibility conditions for the position. As part of the new framework, SEBI has also directed trustees, sponsors and managers of AIFs to explicitly confirm adherence to the certification requirement in the annual Compliance Test Report.
The move is aimed at strengthening governance standards and ensuring uniform regulatory knowledge among compliance officers in the rapidly expanding AIF ecosystem. India’s AIF industry has seen sharp growth over the past decade, with assets under management crossing ₹15 lakh crore, compared with about ₹28,000 crore ten years ago.
