MCA Permits Use of CSR Funds in Social Stock Exchange Zero Coupon Zero Principal Instruments
ZCZP instruments are specialized securities listed on the Social Stock Exchange (SSE), issued by registered Not-for-Profit Organisations (NPOs) that do not pay interest nor return the principal.
Under Section 135 of the Companies Act, 2013, businesses must allocate at least 2% of their average net profit of the past three fiscal years toward CSR initiatives if they meet key criteria such as a net worth of ₹500 crore, turnover of ₹1,000 crore, or net profit of ₹5 crore.
Exam Perspective: Regulatory amendments bridging capital markets with direct public development (such as the Social Stock Exchange) reflect India's evolving ESG and CSR frameworks.
Key Facts / Static GK
Social Stock Exchange (SSE) Regulator: Securities and Exchange Board of India (SEBI)
ZCZP Definition: Zero Coupon Zero Principal instruments represent non-interest-bearing philanthropic investments with no principal repayment
Practice Quiz — 30 May 2026
Q1. Which of the following payments banks received RBI's in-principle approval in 2025 to transition into a Small Finance Bank (SFB)?
Q2. Who has assumed charge as the 48th Vice Chief of the Naval Staff (VCNS) of the Indian Navy?
Q3. With the installation of the SkyCast System at IGI Airport, India has become which country globally to install this advanced aviation weather monitoring system?
Q4. Which specialized technology entity collaborated with the Department of Financial Services to design and launch the Unclaimed Assets Portal?
Q5. Which of the following statements is/are correct regarding the Corporate Social Responsibility (CSR) guidelines in India under Section 135 of the Companies Act, 2013? 1. Companies must spend at least 2% of their average net profits of the previous three financial years. 2. The mandate applies to companies with a net worth of ₹500 crore or more, or a turnover of ₹1,000 crore or more, or a net profit of ₹5 crore or more. 3. Companies can now invest up to 10% of their annual CSR expenditure through Zero Coupon Zero Principal (ZCZP) instruments.
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