The Securities and Exchange Board of India released its consolidated Master Circular for Debenture Trustees on May 1, 2026 — a significant document that consolidates all extant directions, rules, and regulations applicable to debenture trustees registered with SEBI.
What's new in the 2026 Master Circular?
The new circular introduces several key changes that debenture trustees must implement before the June 1, 2026 effective date.
1. Enhanced asset cover monitoring
Trustees are now required to verify asset cover on a quarterly basis, up from semi-annual reviews. This includes obtaining independent valuation reports for non-cash assets backing the debentures.
2. Mandatory disclosure timelines
The circular specifies maximum timelines for various disclosures — 1 working day for material events, 7 days for periodic reports, and 30 days for compliance certificates.
3. Revised default resolution mechanisms
A new tiered approach to default resolution requires trustees to convene a debenture-holders' meeting within 7 days of default notification, with specific procedures for restructuring proposals.
Implementation guidance
At MITCON Credensia, we've already begun implementing these changes across our debenture trustee mandates. We recommend issuers and other trustees:
- Review existing trust deed templates for compliance with new disclosure requirements
- Establish quarterly review calendars for asset cover monitoring
- Update default-handling SOPs to align with the new tiered approach
The full master circular is available in our Circulars section.
