The Securities and Exchange Board of India (SEBI) has decided to implement a new and mandatory UPI payment system to protect investors from fraud perpetrated by fake and unregistered entities.
New Delhi: The Securities and Exchange Board of India (SEBI) has taken a significant step to enhance transparency and investor protection in the Indian stock market. SEBI announced the implementation of a new mandatory UPI payment system to safeguard investors from fraudulent and unregistered brokers. This system will come into effect from October 1, 2025.
This move is in response to incidents where fraudulent brokers and platforms mislead ordinary investors, collect money, and then disappear. The new system aims to ensure that investors only make payments to SEBI-registered brokers and institutions.
How will the new UPI system work?
Under this new system developed by SEBI, every registered broker will be given a unique UPI ID. When an investor sends money for investments in shares, mutual funds, or other investment instruments, they will have to enter this UPI ID.
To make this payment process easier and more secure, SEBI has also introduced a verification tool called ‘SEBI Check’. Investors can verify the broker's legitimacy in three ways:
- By scanning the QR code
- By manually entering the UPI ID
- By entering the broker's account number and IFSC code
If the broker is registered with SEBI, a green 'thumbs up' icon will appear during verification. The absence of this icon indicates that the broker is suspicious or unauthorized.
What are the benefits for investors?
- Protection from fraud: The new UPI system will ensure that investors' money reaches only authorized brokers and institutions. This will significantly reduce fraud by fake investment portals and intermediaries.
- Transparent transactions: Transactions through verified UPI channels will make it easier to track fund flow and reduce the likelihood of disputes.
- Real-time identification: The green thumbs-up icon will instantly confirm whether the payment is going to the right place.
Increased UPI Limit
Previously, a maximum of ₹2 lakh could be paid per day through UPI in the stock market. However, SEBI has increased this limit to ₹5 lakh. This limit will now also apply to capital market transactions.
NPCI (National Payments Corporation of India) will periodically review this limit and may make changes as needed in the future.
Technology Enhances Trust
SEBI chairman Madhabi Puri Buch described this system as an "innovative mechanism" that will provide investors with a verified and secure payment channel. She believes that this system will play a major role in increasing transparency in financial transactions and strengthening the market's credibility.
Geo BlackRock Receives Approval
Market regulator SEBI has granted Geo BlackRock Investment Advisors Private Limited permission to commence operations as an authorized investment advisor in India. This company is a 50:50 joint venture between Reliance group's Jio Financial Services Limited (JFSL) and global investment firm BlackRock Inc.
Earlier, on May 27, 2025, SEBI had approved Geo BlackRock Asset Management Private Limited, a company within the same group, to operate as an Asset Management Company (AMC) for mutual fund business.
