Sebi to launch UPI authentication tool for safer securities transactions

To curb cyber fraud, market regulator Sebi has mandated a new Unified Payments Interface ID format for all registered intermediaries collecting investor funds

The Securities and Exchange Board of India (Sebi) on Wednesday announced a new Unified Payments Interface (UPI)-based mechanism to help investors confirm the authenticity of payment addresses during securities market transactions, as part of its efforts to tackle rising cyber fraud.

 

“There is a lot of public concern regarding cyber fraud. We have to find systemic solutions to it. We have 130 million unique investors now, and we need a system in the securities market where they invest through a system where they know they are investing at the right place,” Sebi Chairperson Tuhin Kanta Pandey said at a press briefing in Mumbai.

 

Under the new framework, the National Payments Corporation of India (NPCI) will coordinate with banks to allocate verified UPI handles to Sebi-registered entities. Banks will implement the necessary system changes to support the tool. Investors, however, will not need to make any changes. “The change will be for the intermediaries and not investors,” Pandey clarified. 

 

The market regulator has mandated that all intermediaries collecting investor funds — such as brokers, investment advisers, and research analysts—transition to this system by October 1, 2025. The new structure is expected to cover nearly 9,000 registered intermediaries.

 

Once the system is live, intermediaries will apply for UPI handles through Sebi’s intermediary portal. Banks will then verify and assign these handles within their systems to ensure their legitimacy.

 

“We are introducing a system within the UPI system to check whether or not a UPI address is genuine, like that of a bank, broker, etc. This would be very handy. It will be implemented from 1st October,” Pandey said.

 

To assist investors, Sebi is also developing a tool called ‘Sebi Check’, which will enable users to verify the UPI ID of an intermediary by scanning a QR code or entering the ID manually. The tool will display associated bank details such as account number and IFSC code.

 

“This innovative mechanism is set to significantly improve the safety and accessibility of financial transactions within the securities market by providing a verified and secure payment channel,” Pandey said.