Key Takeaways
- SEBI is developing remote KYC for NRIs so they don’t need to visit India.
- New surveillance systems will predict and detect market manipulation like pump-and-dump schemes.
- A safety net for depository participants is being examined to handle outages.
- FPI registration process will be simplified to improve operational efficiency.
The Securities and Exchange Board of India (SEBI) is in advanced discussions with UIDAI and RBI to launch a secure, remote KYC process for Non-Resident Indians (NRIs), which is currently in the testing phase. This initiative aims to eliminate the need for NRIs to physically visit India for KYC verification.
SEBI Chairman Tuhin Kanta Pandey emphasized the urgency of this project, stating, “It will be a major development once operational.” He made these remarks during an event organized by the BSE Brokers Forum in Mumbai.
Enhanced Market Surveillance
On the surveillance front, Pandey announced a shift “from reactive supervision to predictive oversight.” SEBI has revamped its data warehouse system to develop new rule-based alerts designed to identify pump-and-dump patterns and detect fraudulent trades in bulk deals.
He noted that pump-and-dump schemes follow identifiable patterns, as seen in past SEBI orders, and the new technology will use data-driven insights to track such manipulative behaviour.
Safety Net for Depository Participants
SEBI is also working on a safety net mechanism for depository participants (DPs). “We are examining the implementation of a safety net so that in the case of an outage at a depository participant, the issue can be handled at the depositories’ end — similar to what exists for stock brokers,” Pandey explained.
Simplifying FPI Registration
Regarding foreign portfolio investor (FPI) registration, the chairman said SEBI aims to further simplify the process. He described FPI registration as “a window to the world,” adding that if the “window itself has cobwebs, it won’t shine in its glory.” He clarified that this effort is about identifying and addressing operational issues, not about risk.
Focus on Investor Protection
Pandey reiterated that protecting investors from cyber fraud and misleading advice from unregistered financial influencers remains a key focus area. He highlighted several recent technology-led initiatives, such as the Investor Risk Reduction Access Platform and a Unified Investor App, which have strengthened investor protection and market efficiency.
These platforms provide consolidated access to holdings, transaction history, e-voting, and proxy advisory recommendations. Grievance resolutions have also been streamlined with Digital Locker and an upgraded SEBI Complaints Redressal System (SCORES).
