Crowdfunding, which is the practice of raising funds from a large number of people through online platforms, has gained popularity in India as a means to support various causes, businesses, and creative projects. The introduction of crowdfunding licenses by the Securities and Exchange Board of India (SEBI), the regulatory authority for securities and commodities markets in India, has been instrumental for several reasons. Crowdfunding license in India ensures regulatory oversight and investor protection.
SEBI regulates crowdfunding platforms, sets operational guidelines, and monitors compliance, which helps prevent fraudulent activities and protect investors from potential scams. This builds trust among investors and encourages participation in crowdfunding campaigns, thereby promoting the growth of the crowdfunding industry in India. Crowdfunding license in India promotes financial inclusion. Crowdfunding provides an alternative funding source for small businesses, start-ups, and social enterprises that may face challenges accessing traditional funding avenues.