SEBI to Introduce “Validated UPI Handles” and “SEBI Check” for Secured Payments by Investors to Enhance Investor Protection and Combat Fraud

## Report on SEBI's Initiative for Secured Payments by Investors (PR No. 312025) **1. Executive Summary:** This report analyzes Securities and Exchange Board of India's (SEBI) new initiative, announced on June 11, 2025, to enhance investor protection and combat fraud in the securities market. Effective October 1, 2025, SEBI will introduce a validated Unified Payment Interface (UPI) address mechanism for SEBI-registered investor-facing intermediaries. The core purpose is to provide a secure and easily verifiable channel for investors to make payments, thus mitigating risks associated with unauthorized fund collection by unregistered entities. Key findings include the introduction of "validated" UPI handles, a "SEBI Check" tool, and visual verification cues to ensure secure transactions. **2. Introduction:** This report provides a comprehensive overview of SEBI's initiative (PR No. 312025) to introduce validated UPI handles and a "SEBI Check" tool for secured payments by investors. The analysis is based solely on the provided policy text and aims to inform affected industry stakeholders about the key aspects of this new framework. **3. Policy Overview:** This is a new policy initiative. * **Core Objective(s):** * Enhance investor protection. * Combat unauthorized money collection in the securities market. * Enable investors to easily identify legitimate SEBI-registered market intermediaries. * Provide a secure and efficient payment channel. * Increase investor confidence. **4. Background and Rationale:** This new policy addresses the growing issue of unregistered entities misleading investors by collecting funds without authorization, often misappropriating these funds. The lack of a standardized and verifiable payment mechanism creates vulnerabilities that these fraudulent actors exploit. This initiative aims to proactively curb such activities by establishing a framework that enables investors to easily verify the legitimacy of market intermediaries before making payments. **5. Key Provisions:** This policy establishes the following key provisions: * **Validated UPI Addresses:** All SEBI-registered intermediaries who collect funds from investors are mandated to use a new, structured UPI address format consisting of: * A readable username chosen by the intermediary followed by a suffix that clearly identifies their category (e.g., ".brk" for a stock broker, ".mf" for a mutual fund). * An exclusive "valid" handle featuring the word "valid" combined with the name of the self-certified syndicate bank. These handles will be exclusively allocated by the National Payments Corporation of India (NPCI) for payment collection by SEBI-registered intermediaries. * **Visual Verification:** A "ThumbsUp inside a green triangle" icon will be displayed during transactions to registered intermediaries using the new handle, providing a clear visual cue for investors. * **Mandatory QR Codes:** Intermediaries are required to generate QR codes featuring the "thumbsup" logo for investor convenience. * **SEBI Check Tool:** SEBI is developing a "SEBI Check" tool that will allow investors to: * Verify the authenticity of UPI IDs by scanning a QR code or manually entering the UPI ID. * Confirm the bank details (bank account number and IFSC) of a registered intermediary. **6. Target Audience and Stakeholders:** The primary target audience and stakeholders are: * Investors in the securities market. * SEBI-registered market intermediaries (stock brokers, mutual funds, etc.) that collect funds from investors. * National Payments Corporation of India (NPCI). * Self-certified syndicate banks. **7. Implementation Aspects (Inferred):** * **Responsible Agency/Bodies:** SEBI is the primary regulatory body responsible for implementing this policy. NPCI is responsible for allocating the "validated" UPI handles. Self-certified syndicate banks will be involved in the UPI address validation process. * **Timelines:** The policy is effective from October 1, 2025. Both Validated UPI Addresses and SEBI Check shall be available to users from that date. * **Procedures:** * Intermediaries must adopt the new UPI address structure. * NPCI will allocate "validated" UPI handles to eligible intermediaries. * Intermediaries must generate QR codes featuring the "thumbsup" logo. * Investors can utilize the "SEBI Check" tool to verify UPI IDs and bank details. **8. Expected Outcomes / Impact of Changes:** The intended outcomes of this policy are: * **Enhanced Investor Protection:** By providing a verifiable payment channel, the policy aims to reduce the risk of fraud and unauthorized fund collection. * **Assured Payments:** Investors can be more confident that their payments are directed to legitimate and SEBI-registered intermediaries. * **Clear Warning Signs:** The absence of the "thumbsup" icon will alert investors to potential risks. * **Increased Confidence:** The secure payment mechanism will boost investor confidence and encourage them to engage only with authorized entities. **9. Conclusion:** SEBI's initiative to introduce validated UPI handles and the "SEBI Check" tool represents a significant step towards enhancing investor protection and combating fraud in the securities market. By providing a secure and easily verifiable payment channel, this policy aims to instill greater confidence among investors and ensure that their funds are directed only to legitimate SEBI-registered intermediaries. The successful implementation of this initiative, effective October 1, 2025, will contribute to a more secure and transparent investment environment.

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