New Delhi, Aug. 27 -- The Securities and Exchange Board of India (Sebi) has proposed exempting certain listed issuers from the mandatory appointment of a merchant banker for small-value debt raised through private placement, aiming to cut costs and delays in the debt market.

In a consultation paper issued on Thursday, the market regulator said the limited availability of merchant bankers in the debt segment and the delays involved in appointing them can also hinder small-value debt issuance. This is particularly relevant in a market where yields can change quickly, potentially raising the issuer's cost of borrowing if a transaction is delayed.

Under the existing framework, issuers of debt securities or non-convertible redeemable prefere...