India, Aug. 13 -- Markets regulator Sebi on Thursday proposed introducing a mandatory colour-coded 'Credit Risk-o-Meter' for debt securities, to help investors assess credit risk more easily before investing.

Inspired by the risk-o-meter framework for mutual funds, the proposed tool will use a standardised, colour-coded scale to depict the credit risk associated with a debt security.

The move is aimed at simplifying complex credit ratings, enabling investors to assess and compare debt securities more easily and align their investments with their risk appetite, Sebi said in a consultation paper.

Under the proposal, issuers and online bond platform providers (OBPPs) will be required to display the Credit Risk-o-Meter in offer documents, ...