Sebi wants reactions by July 16. It has proposed that crowdfunding only take place through Sebi-recognised platforms. Entities which qualify include stock exchanges, depositories, technology incubators and associations of private equity or angel investors.

Bringing in some elements of initial public offering (IPO) guidelines, the regulator has prescribed minimum subscription limit of 75 per cent for public issue of debt securities. Failing to garner minimum subscription of 75 per cent of the base issue size, the issuer will have to refund application money to investors within 12 days of issue closing.

A city-based lawyer, Prashaanth Balasubramaniam, has contended the ordinance’s provisions are “utter violation of constitutional principles”.

Besides, Sebi is considering at least 10 per cent of the shares to be sold through the OFS mechanism to be revered for retail investors, while non-promoters may also be permitted to tap the route, officials said.

Such windows have previously been made available to mutual funds during times when the industry has faced a severe cash crunch. The stock market regulator has invited the central bank's feedback on whether such a repo window can be used to provide stability on an ongoing basis in addition to in times of such crises.