Can friends pool money to invest in an AIF? The minimum ticket rule

General information only. This is not investment advice and nothing here recommends investing in any fund. It explains what the regulation says about the minimum ticket and who is exempt from it. Text is taken from the SEBI (Alternative Investment Funds) Regulations, 2012 in the consolidated version dated 14 July 2026, and from one SEBI circular dated 7 September 2026.

The short answer

No. Pooling does not lower the minimum. Regulation 10(c) puts the duty on the fund: it "shall not accept from an investor, an investment of value less than one crore rupees" (Reg 10(c), SEBI AIF Regulations 2012). The test is applied to the investor the fund accepts, so five friends each putting in twenty lakh rupees do not become one ₹1 crore investor by sending the money through one account.

There are real exceptions to the ₹1 crore floor. There are four of them in the current text, not two, and none of them is a pooling exception. They are set out below.

The numbers in Regulation 10

Regulation 10 begins: "Investment in all categories of Alternative Investment Funds shall be subject to the following conditions." So the conditions apply to Category I, Category II and Category III funds alike (Reg 10, chapeau).

Two conditions matter here.

Scheme corpus. "Each scheme of the Alternative Investment Fund shall have corpus of at least twenty crore rupees." A proviso lowers this for social impact funds: each scheme of a social impact fund "shall have a corpus of at least five crore rupees" (Reg 10(b) and proviso).

Per-investor minimum. "The Alternative Investment Fund shall not accept from an investor, an investment of value less than one crore rupees" (Reg 10(c)). Because the rule says the fund "shall not accept", a manager cannot take a smaller cheque just because the investor is willing to give it.

The carve-outs from the ₹1 crore floor

Regulation 10(c) carries three provisos, and the angel fund rule sits in Regulation 19D. Each reads differently, so quote them rather than paraphrase them.

1. Employees and directors of the fund or manager. "In case of investors who are employees or directors of the Alternative Investment Fund or employees or directors of the Manager, the minimum value of investment shall be twenty five lakh rupees" (Reg 10(c), first proviso). This attaches to the person's own status. A friend or relative of an employee is not an employee.

2. Accredited investors. "This clause shall not apply to an accredited investor" (Reg 10(c), second proviso). The one crore floor does not bind an accredited investor at all.

3. Social impact funds investing in not-for-profit securities. "In case of a social impact fund which invests only in securities of not for profit organizations registered or listed on a social stock exchange, the minimum value of investment by an individual investor shall be one thousand rupees" (Reg 10(c), third proviso). This is a narrow case: the fund must invest only in those securities, and the relaxed floor is stated for an individual investor.

4. Angel funds. Separately from Regulation 10, the regulations say: "No minimum value of investment shall be applicable for investment in an angel fund by an angel investor" (Reg 19D(2)). An angel fund may raise funds only from accredited investors, and key management personnel of the angel fund or its manager may also invest (Reg 19D(1) and proviso).

Nothing in the text creates a pooling exception, a family exception or a joint-application exception. Two siblings who each hold fifty lakh rupees remain two investors below the floor unless one of the carve-outs above applies to each of them.

Who is an "accredited investor"

The definition sits in the regulations, not in the fund's brochure. An accredited investor is a person who "is granted a certificate of accreditation by an accreditation agency" and who meets the financial test for their type (Reg 2(1)(ab)).

For an individual, Hindu Undivided Family, family trust or sole proprietorship the test is any one of:

• annual income of at least two crore rupees; or
• net worth of at least seven crore fifty lakh rupees, of which at least three crore seventy-five lakh rupees is in financial assets; or
• annual income of at least one crore rupees and net worth of at least five crore rupees, of which at least two crore fifty lakh rupees is in financial assets.

A body corporate needs net worth of at least fifty crore rupees. A trust other than a family trust needs net worth of at least fifty crore rupees. For a partnership firm under the Indian Partnership Act, 1932, each partner must independently meet the criteria (Reg 2(1)(ab)(i) to (iv)).

A proviso deems certain entities to be accredited investors without a certificate, including the Central and State Governments, qualified institutional buyers, Category I foreign portfolio investors, sovereign wealth funds and multilateral agencies (Reg 2(1)(ab), proviso).

The point for a group of friends is that accreditation is individual, certificate-based and agency-granted. A self-declared "sophisticated investor" letter is not the certificate. The accreditation agencies and the process for obtaining a certificate are not set out in the regulation text read for this article, so check them with the agency itself.

Angel funds and the 31 March 2027 date

SEBI's circular of 7 September 2026 (HO/19/34/11(7)2025-AFD-POD1/I/20626/2026) deals with the accredited-investor mandate for angel funds. It extends a transition date. Angel funds registered with SEBI on or before 10 September 2025 must implement the mandate on or before 31 March 2027, and may not offer investment opportunity to more than 200 non-accredited investors during that period. After 31 March 2027 they may not accept contribution for an investment in an investee company from non-accredited investors. Existing investors continue to hold the investments already made, per the fund's documents (circular of 7 September 2026, para 5).

The circular's text is the authority for these dates. The earlier date of 8 September 2026 that appeared in the original master circular paragraph is replaced by it.

Why pooling fails even among people who trust each other

Pooling takes one of three shapes.

Direct pooling. Five friends send money to one friend, who subscribes in her own name. The fund records one investor. If her own ticket is below ₹1 crore and none of the carve-outs fits her, the fund could not accept it. If it is above ₹1 crore, the other four hold no units and no recorded interest, so the arrangement among friends sits outside the fund's books.

Entity pooling. The friends form a company or LLP that subscribes. The entity is now the investor, so the entity must meet the floor or fit a carve-out on its own terms. For accreditation, a body corporate needs net worth of at least fifty crore rupees (Reg 2(1)(ab)(ii)). The friends' personal means do not carry across.

Joint or sequential subscription. Two applicants each offering fifty lakh rupees in one application, or small subscriptions at successive closes, repeat the same defect. Each underlying investor is still below the floor.

The scheme corpus condition is separate and also applies. A scheme needs corpus of at least twenty crore rupees, or five crore rupees for a social impact fund scheme (Reg 10(b)). A circle of friends cannot create a scheme around its own contribution.

Four worked patterns

These are illustrations of how the text reads, not recommendations.

Pattern one. One investor subscribes ₹1 crore in her own name. This meets the floor in Reg 10(c).

Pattern two. Two siblings subscribe ₹50 lakh each in one joint application. Each underlying investor is below ₹1 crore and neither is an employee, director or accredited investor. On the text, the fund shall not accept this.

Pattern three. An employee of the manager subscribes ₹25 lakh in his own name. This fits the first proviso. If he adds his brother's ₹25 lakh to the same application, the brother's portion has no proviso behind it.

Pattern four. An individual who holds a valid certificate of accreditation subscribes below ₹1 crore. The second proviso says the floor does not apply to an accredited investor. The certificate is what carries the weight.

What to do now

• Next step: Before moving any money, ask the fund manager in writing which carve-out, if any, applies to each named investor, and ask for the Regulation 10 compliance position for the scheme, including its current corpus (Reg 10(b) and (c)).
• Deadline to watch: If an angel fund is involved and was registered on or before 10 September 2025, the accredited-investor transition runs to 31 March 2027 (SEBI circular of 7 September 2026, para 5).
• Consequence: The regulation puts the duty on the fund: it "shall not accept" a ticket below the floor unless a proviso applies (Reg 10(c)). A subscription that does not fit can be refused or defective, whatever the friends agreed among themselves.

Have a CA review your facts before you act or file.

Questions to put to the manager

• What is the scheme's current corpus, and which minimum applies: twenty crore rupees, or five crore rupees as a social impact fund scheme?
• What is the minimum ticket the fund accepts from an investor who is not an employee, director or accredited investor, and under which clause?
• If someone claims the employee or director route, which named individual holds which post at the fund or manager?
• If someone claims the accredited route, what is the date and issuer of the certificate of accreditation, or which deemed category applies?
• How will units be recorded, and in whose name?

FAQ

What is the minimum I can invest in an AIF?
One crore rupees per investor, subject to the provisos. "The Alternative Investment Fund shall not accept from an investor, an investment of value less than one crore rupees" (Reg 10(c)).

Does the floor apply to every AIF category?
Regulation 10 says investment in all categories of Alternative Investment Funds is subject to its conditions (Reg 10, chapeau).

Can fund employees invest less?
Employees or directors of the fund or of the Manager have a minimum of twenty five lakh rupees (Reg 10(c), first proviso).

Do accredited investors face the one crore floor?
The clause does not apply to an accredited investor (Reg 10(c), second proviso). Accreditation is by certificate from an accreditation agency, subject to the financial tests, or by deemed status for listed categories (Reg 2(1)(ab)).

Is there any minimum for angel funds?
No minimum value of investment applies for investment in an angel fund by an angel investor (Reg 19D(2)). Angel funds raise funds only from accredited investors (Reg 19D(1)).

Can five friends pool fifty lakh rupees each into one ₹1 crore ticket?
The regulation text contains no pooling, family or joint-application exception. The fund must not accept less than one crore rupees from an investor unless a proviso applies to that investor (Reg 10(c)).

Can the fund waive the floor for a large group committing together?
The floor is a restriction on the fund ("shall not accept"). Scale helps meet the separate corpus condition in Reg 10(b); it does not lower any individual's minimum.

Last checked against the consolidated SEBI AIF Regulations (14 July 2026) and SEBI's circular of 7 September 2026. Reviewed on 2 November 2026. General information, not investment advice.

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