CURRENT AFFAIRS
CURRENT AFFAIRS
Description
In a significant step towards safeguarding investors and enhancing transparency in digital financial transactions, the Securities and Exchange Board of India (SEBI) has unveiled a new initiative titled “SEBI Check.” This tool is designed to help investors verify UPI payment identifiers linked to SEBI-registered entities before making any monetary transfers. The feature aims to counter the growing menace of financial scams involving fake UPI handles.
On June 11, 2025, SEBI officially introduced the “SEBI Check” system in response to the increasing number of frauds conducted via fake or unauthorized UPI IDs. Fraudsters have been exploiting the trust of investors by posing as registered market intermediaries and collecting funds through unverified digital payment channels. In light of these concerns, SEBI has also made it mandatory for all registered intermediaries to adopt a verified UPI payment system by October 1, 2025.
About SEBI Check
“SEBI Check” is a digital verification platform aimed at boosting investor confidence in financial transactions. It will enable users to:
Manually enter a UPI ID or scan a QR code to initiate verification.
Receive confirmation of the associated bank account, including the account number and IFSC code.
Verify whether the UPI handle is officially registered with a SEBI-approved intermediary.
This mechanism is designed to prevent fund transfers to unverified entities and ensure the legitimacy of the recipient.
Purpose And Significance
The initiative is part of SEBI’s broader goal to:
Minimize risks associated with phishing and impersonation fraud.
Provide retail investors with easy-to-use tools for secure financial transactions.
Ensure that digital payment practices within capital markets are aligned with regulatory standards.
Background And Need For Action
The move follows a consultation paper issued in January 2025, which highlighted the risks posed by unauthorized fund collections and rising instances of fraud in the capital markets. Many unregistered entities had been deceiving investors by using UPI handles similar to those of legitimate financial players.
Key Highlights Of New UPI Framework
Mandatory Compliance: All SEBI-registered intermediaries, including brokers, mutual fund distributors, and depository participants, must adopt the verified UPI mechanism.
Enhanced Transparency: The verification process fosters greater trust in online transactions.
Boosts Digital Integrity: Helps maintain the credibility of India's securities ecosystem by curbing fraud at the transaction level.
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