SEBI Proposes Colour-Coded Credit Risk-o-Meter for Debt Securities

# SEBI Proposes Colour-Coded Credit Risk-o-Meter for Debt Securities ### Why in News? **SEBI** proposed a mandatory colour-coded **Credit Risk-o-Meter** to help investors quickly understand the default risk of debt securities. ### How will the Risk-o-Meter work? - The proposed meter uses six colour-coded levels ranging from low to very high credit risk. - Issuers and online bond platforms would display it in offer documents, advertisements and digital interfaces. - If multiple credit ratings exist, the meter would use the lowest rating, giving investors a conservative view of risk. ### Exam Connect - **SEBI** → securities-market regulator - **Debt security** → instrument through which an investor lends money to an issuer - **Credit risk** → risk that the borrower may fail to repay