Unified Payment Interface (UPI) Mechanism by SEBI
The Securities and Exchange Board of India (SEBI) is implementing a structured UPI address mechanism to address the issue of unregistered entities misleading investors in the stock market.
Objective
- Streamline fund collection by registered intermediaries from investors.
- Enable identification of legitimate SEBI-registered intermediaries.
- Enhance investor protection and combat unauthorized money collection in the securities market.
Implementation Details
- Introduction of a structured and validated UPI address mechanism with an exclusive “@valid” handle for registered intermediaries.
- Deadline set for October 1, 2025, for the introduction of these facilities.
- Validated UPI handle allocated by the National Payments Corporation of India (NPCI).
UPI Address Structure
- Username will include a readable name chosen by the intermediary.
- Mandatory suffix to identify intermediary category:
- ‘.brk’ for stock brokers
- ‘.mf’ for mutual funds
- Example: For ABC Ltd., a broker with XYZ bank, UPI ID would be abc.brk@validXYZ.
Investor Features
- Visual cue for legitimate transactions: “thumbs-up inside a green triangle” icon.
- Structured UPI handle use is optional for investors; other payment methods remain available.
- Existing ongoing SIPs remain unaffected, but new SIPs must use new UPI IDs post October 1, 2025.
SEBI Check Tool
- Allows verification of UPI IDs via QR code or manual entry.
- Confirms intermediary bank details such as bank account number and IFSC.
- Available from October 1, 2025.
- Enhances verification and authenticity before financial transactions.
SEBI Chairman Tuhin Kanta Pandey emphasized the mechanism's role in improving transaction safety and accessibility in the securities market.
