SEBI proposes municipal bond tweaks to permit refinancing with tighter disclosure and spending limits

Published on 14 May 2026

Refinancing debt is back on the table, but rules tighten hard

SEBI has proposed changes to India’s municipal bond framework, allowing local bodies to explicitly issue bonds to refinance existing debt. The draft also demands detailed disclosures on lenders, repayment schedules, interest costs and any prior restructurings. In addition, it suggests capping working-capital use at 25% and restricting proceeds from general-purpose spending.

Municipalities may issue bonds specifically to refinance older debt
Proposed disclosures cover lenders, repayment plans, interest and prior restructuring
Working capital use from issue proceeds capped at 25%
Proceeds should not be used for general purposes

#sebi #debt refinancing #disclosures #municipal bonds #working capital

Read the full story at The Economic Times

This summarization was done by Beige for a story published on The Economic Times

SEBI proposes municipal bond tweaks to permit refinancing with tighter disclosure and spending limits

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