The National Stock Exchange (NSE) is planning to operationalize the proposed SME Exchange in coming months, after getting approval from the Securities and Exchange Board of India (SEBI). The NSE along with Small Industries Development Bank of India (SIDBI) is also planning to set up this exchange and has got approval from the SEBI. Earlier, the BSE had got approval from SEBI for its proposed SME Exchange and it is likely to start the operations in the coming months.

The idea of SME exchange has been arise as small and medium enterprises find it difficult to raise funds from primary market as investors have less interest towards making investment in their issues along with higher charges of listing. The idea has come into mind after a task-force set up by the Prime Minister’s Economic Advisory Council has recommended for launching such exclusive platforms for the SMEs. The finance ministry has also asked the market regulator to consider the proposal of reduction in the mandatory period prescribed for market-making to six months from three years, reduction in time period for initial public offering, and many more.