Sebi's Valid UPI rollout faces hurdles as advisors struggle with handles

Sebi's new Valid UPI initiative, effective October 1, has hit hurdles as many research analysts and investment advisors face mismatches and bank delays in securing handles

The Securities and Exchange Board of India’s (Sebi’s) initiative to introduce “Valid” UPI handles for market intermediaries from October 1 is running into operational hurdles, with a large number of research analysts and investment advisors yet to secure their handles.

 

In June, Sebi mandated a new UPI format with the suffix “@valid” for all registered intermediaries to prevent fraud and impersonation. The initiative is aimed at ensuring that investors transfer funds only to authorised entities, since banks will issue the handles exclusively to intermediaries verified on Sebi’s system.

 

Several intermediaries have flagged issues such as: Mismatches between names on Sebi’s Intermediary Portal (SI Portal) and bank records, limited awareness among bank staff about the process, and absence of several banks from the approved list.

 

“Our entity’s name is different on Sebi’s Intermediary Portal. Since banks verify names from that portal before issuing handles, our application is stuck. We have raised this with Sebi,” a research analyst told Business Standard.

 

An industry participant estimated that nearly 25 per cent of investment advisors are yet to get their UPI handles validated.

 

“Investment advisors come under BSE’s supervision, and their names do not appear on Sebi’s SI portal. While BSE advised us to approach our banks directly, most branches had little clarity. Applications are pending and email queries to banks remain unanswered,” an investment advisor said. They added that names of several banks were missing from the exchange’s approved list.

 

BSE has since taken up the matter “on a war footing” and is following up with intermediaries individually, according to another advisor.

 

"Most of the IAs and RAs are individuals who have traditionally been using their savings bank accounts for fee collection. However, banks have recently mandated that valid UPI handles for professional fee collection be routed only through current accounts. This requirement is adding an additional step in the process and is consequently leading to delays in valid UPI handle approval," said a BSE spokesperson. 

 

Sebi recently held a webinar with around 600 participants to address these concerns. However, several issues remain unresolved, with the regulator asking intermediaries to submit their queries over email for further clarification. Some industry players noted that the lack of valid UPI handles may not pose an immediate disruption, as many clients prefer other payment modes when transacting with advisors.

 

The new UPI IDs will follow formats such as abc.bkr@validhdfc or xyz.mf@validhdfc. For easier recognition, they will also carry a white “thumbs up” icon inside a green triangle. Banks are required to issue the handles only after matching intermediary details with Sebi’s portal.

 

Under the June circular, banks had been asked to complete allocations within 90 days, after which old UPI IDs would be discontinued in a phased manner. 

 

Queries sent to Sebi remained unanswered till the time of publication.