NGO Unnati India's first Social Stock Exchange debut: A tale of triumphs and tribulations

Here is an introduction of India's inaugural Social Stock Exchange (SSE) and the inclusion of the initial NGO, Unnati, on the SSE platform. Unnati sought to generate Rs 2 crore to facilitate the training of graduates from government colleges, aiding them in employment placement via its UNXT initiative. The subscription for the issue reached 90%, accumulating approximately Rs 1.8 crore in funds.

Ramesh Swamy, lead trustee at the SGBS Unnati Foundation, credits the SSE for providing recognition and accolades to Unnati. The article emphasizes the challenges faced by NGOs in ensuring subscription, with Unnati being grateful for pro-bono assistance in filing offer documents. It also highlights Zerodha's donation of Rs 1 crore and contributions from other entities.

The SSE involves securities that are neither bonds nor shares and cannot be traded. The minimum issue size and application size were reduced to Rs 50 lakh and Rs 10,000, respectively, after consultations with the market regulator SEBI. The SSE focuses on social and environmental impact reporting instead of profit and loss status.

For NGOs, the SSE offers wider access to donors and credibility through association with SEBI, NSE, and BSE. Donors, despite not being eligible for tax benefits or using corporate social responsibility (CSR) funds for SSE issues, can track fund utilization through a social impact assessor.

The article suggests that tax benefits could enhance donor participation, with 39 NGOs registered with NSE and 37 with BSE. The SSE is viewed as a transformative step toward integrating social responsibility with capital markets, setting the stage for further developments.

In summary, the SSE aims to connect NGOs with donors, enhance transparency through impact reporting, and create a platform for socially responsible investing.