Key Takeaways
- SEBI developing remote KYC system for NRIs in collaboration with UIDAI and RBI
- New system aims to eliminate need for NRIs to travel to India for verification
- Enhanced surveillance using predictive oversight and data-driven fraud detection
- Safety net mechanism for depository participants under consideration
The Securities and Exchange Board of India (SEBI) is developing a remote KYC system that would allow non-resident Indians to complete identity verification without traveling to India. The regulator is in advanced discussions with UIDAI and RBI to enable this secure digital process, currently in testing phase.
Urgent Priority for NRI Convenience
SEBI Chairman Tuhin Kanta Pandey emphasized that eliminating the travel requirement for NRIs is an urgent goal. “It will be a major development once operational,” Pandey stated during a BSE Brokers Forum event in Mumbai.
Enhanced Market Surveillance
SEBI is transitioning from reactive supervision to predictive oversight through upgraded technology systems. The regulator has revamped its data warehouse to develop rule-based alerts for identifying pump-and-dump patterns and detecting fraudulent trades in bulk deals.
“Pump-and-dump schemes follow identifiable patterns, as reflected in SEBI orders, and the new technology will help track such manipulative behaviour using data-driven insights,” Pandey explained.
Safety Net for Depository Participants
The regulator is examining a safety net mechanism for depository participants (DPs) similar to existing provisions for stock brokers. This would ensure that outages at depository participant level can be handled at the depositories’ end.
FPI Registration Simplification
SEBI aims to further simplify foreign portfolio investor (FPI) registration processes. Pandey noted, “FPI registration is a window to the world, and if the window itself has cobwebs, it won’t shine in its glory. This is not about risk; it’s about identifying and addressing operational issues.”
Investor Protection Focus
Protecting investors from cyber frauds and misleading advice by unregistered finfluencers remains a key priority. Recent technology initiatives including the Investor Risk Reduction Access Platform and Unified Investor App have strengthened investor protection and market efficiency.
These platforms provide consolidated access to holdings, transaction history, e-voting, and proxy advisory recommendations. Grievance resolution has been streamlined through Digital Locker and an upgraded SEBI Complaints Redressal System (SCORES).
