Description

SEBI mandates structured UPI address mechanism for registered intermediaries to collect funds from investors with enhanced safety and accessibility.

Summary

SEBI has introduced a structured Unified Payment Interface (UPI) address mechanism for SEBI-registered investor-facing intermediaries to collect funds from investors. This initiative aims to enhance accessibility and safety in securities markets by providing investors with validated payment channels to verified and registered market intermediaries. While usage remains optional for investors, obtaining and making available structured UPI addresses is mandatory for intermediaries.

Key Points

  • Structured UPI mechanism provides direct fund transfer to validated intermediary bank accounts
  • Username format: intermediary name + segment abbreviation (e.g., abc.brk for broker, xyz.mf for mutual fund)
  • UPI Handle uses unique “@valid” identifier combined with SCSB names (e.g., abc.bkr@validhdfc)
  • “Thumbs-up inside green triangle” icon will identify validated intermediary payments
  • Mandatory for intermediaries to obtain structured UPI addresses
  • Optional for investors but intermediaries encouraged to promote adoption
  • Developed through consultation with NPCI and Self-Certified Syndicate Banks

Regulatory Changes

  • Introduction of mandatory structured UPI address framework for all SEBI registered intermediaries
  • New standardized username generation utility for intermediaries
  • Unique UPI handle allocation system through NPCI
  • Visual identification system for verified intermediary payments
  • Enhanced payment validation mechanism for investor protection

Compliance Requirements

  • All SEBI registered intermediaries must obtain structured UPI addresses
  • Intermediaries must make UPI addresses available to their investors
  • Username generation only through SEBI-provided utility
  • Active promotion and facilitation of mechanism adoption among investors
  • Compliance with standardized format: username.segment_abbreviation@validbank_name
  • Implementation of visual verification system for investor payments

Important Dates

  • Circular Date: June 11, 2025
  • Implementation timeline and specific deadlines not specified in the circular excerpt

Impact Assessment

  • Market Operations: Significant transformation in payment collection mechanisms across securities market
  • Intermediaries: Mandatory compliance requirement affecting all registered entities including brokers, mutual funds, RTAs
  • Investors: Enhanced payment security and verification capabilities
  • Technology Infrastructure: Integration with NPCI systems and SCSB platforms required
  • Operational Impact: Standardization of payment processes and reduced fraud risk through validated channels

Impact Justification

Mandatory implementation for all SEBI registered intermediaries affecting payment collection mechanisms across securities market