Lotus Petal Foundation taps BSE Social Stock Exchange to raise ₹1 crore for education project

Gurugram-based non-profit Lotus Petal Foundation (LPF) is set to raise ₹1 crore through a Zero Coupon Zero Principal (ZCZP) bond issue on the BSE Social Stock Exchange (SSE), joining a growing list of organisations using India's social capital markets to fund development projects. The public issue will open on July 20 and close on July 31, with a minimum investment of ₹1,000.

The proceeds will be used to fund a year of uninterrupted education for 160 students studying in classes 3 and 5 at Lotus Petal Senior Secondary School in Dhunela, Gurugram. The project will cover tuition, books, uniforms, stationery, transportation, digital learning, breakfast and lunch, ensuring children from underserved communities continue their education without financial disruption.

Founded in 2011, Lotus Petal Foundation works in education, nutrition and livelihood development. Besides operating a CBSE-affiliated school with around 1,200 students, the organisation runs a live digital learning platform reaching more than 12,000 students, undertakes government school transformation projects and provides STEM scholarships to underprivileged students.

"The Social Stock Exchange gives organisations like ours credibility because every fundraising proposal undergoes a structured regulatory review," Kushal Raj Chakraborty, Founder and Managing Trustee of Lotus Petal Foundation, told Fortune India. "It also provides transparency through escrow-based fund management, audited utilisation reports and independent impact assessments, helping donors and corporates contribute with greater confidence."

The issue comes at a time when the government recently allowed companies to deploy up to 10% of their annual Corporate Social Responsibility (CSR) expenditure through subscriptions to eligible ZCZP instruments listed on social stock exchanges, opening a new fundraising channel for registered non-profit organisations.

Chakraborty said the regulatory change could help bridge the gap between credible non-profits and corporate CSR capital.

"We have started engaging with corporates, although discussions are still at an early stage. Our immediate focus is to successfully execute this first issue. Once that is achieved, we intend to use the Social Stock Exchange platform to raise larger project-specific funding from both corporates and retail donors."

Unlike conventional bonds, ZCZP instruments do not pay interest or return principal. Instead, investors make philanthropic contributions to specific social projects and receive tax benefits, while issuers are required to disclose audited utilisation and impact reports under the Social Stock Exchange framework.

Over the past 15 years, Lotus Petal Foundation has mobilised an estimated ₹180-200 crore through a combination of corporate CSR, individual donations and overseas funding. Around 75% of the funds have been deployed towards education, with the remainder supporting nutrition and livelihood initiatives.

Looking ahead, the organisation plans to expand its school campus to accommodate nearly 10,000 students and scale its digital learning platform from around 12,000 learners to one lakh students over the next few years.

For Lotus Petal Foundation, the Social Stock Exchange listing is as much about building long-term credibility as it is about fundraising.

"If we can successfully demonstrate transparency and measurable outcomes through this issue, it will help us access a much wider pool of philanthropic capital and ultimately educate many more children," Chakraborty said.