SEBI prioritises cutting compliance burden to boost market competitiveness

SEBI is prioritising the reduction of compliance burdens and regulatory costs to enhance the competitiveness of the Indian securities market. Chairman Tuhin Kanta Pandey says this will improve access to finance and boost the nation's economy.

The Securities and Exchange Board of India (SEBI) is prioritising the reduction of compliance burdens and regulatory costs to enhance the competitiveness of the Indian securities market. This focus on cost efficiency aims to improve access to finance across all productive sectors while maintaining the core objectives of market regulation.

Speaking to the media at the sidelines of the Sixth Annual International Research Conference on Securities Market (2025-26) organised by SEBI and the National Institute of Securities Markets (NISM) in collaboration with IIM Mumbai, Maharashtra National Law University, Mumbai, and NSE, SEBI Chairman Tuhin Kanta Pandey highlighted the critical link between regulatory overheads and the broader economy. He noted that high compliance costs can hinder the nation's competitive edge. "Efficiency, cost efficiency of all our measures is important because if you have to build competitiveness, then obviously if there is a compliance burden on regulation, it's too high in terms of cost and time, then obviously to that extent the competitiveness also goes down," Pandey said.

Framework for Regulatory Impact Assessment

He noted that while there is no way to quantify exactly how much GDP expansion could accrue from these efforts, reducing the cost of capital remains a primary goal. The market regulator is currently establishing a framework for regulatory impact assessment, a move previously indicated by the Finance Minister in budget announcements. A committee chaired by the Chief Economic Advisor is set to provide guidance on this assessment.

Centre for Regulatory Studies

To support this, SEBI is launching a Centre for Regulatory Studies. "That will be a high-level centre which will be a continuing centre, and that will also help with this research," the Chairman stated. He added that the initiative would allow policy schools and research institutes to collaborate on understanding how regulations impact the market, as there is always an inherent cost to regulation.

Inter-Regulatory Coordination

Addressing the interconnectedness of the financial system, Pandey mentioned that these issues are discussed at the Financial Stability and Development Council (FSDC) level. "Basically, I think it's a part of the whole exercise which, through FSDC, the inter-regulatory bodies' coordination is set up and they are looking at various ways to collect data, push research, and then throw up ideas on how we can improve the access and reduce the cost of finance in general," he explained.

NSDL Technical Glitch Update

Regarding the recent technical glitches at the National Securities Depository Limited (NSDL), the Chairman confirmed that the system is now functioning normally. He explained that a technical issue in the inter-depository transfer system led to settlement backlogs, which were cleared by the weekend. SEBI is now awaiting a root cause analysis to be presented to the Technical Advisory Committee.

"In the legacy software, sometimes some glitches may come because of the growing nature of the market and then they have to suitably upgrade and suitably identify the glitches," he said.

Future Initiative: Consolidated Asset Statement

The Chairman also noted that SEBI is working toward a system where investors can eventually access a consolidated statement of all financial assets across different regulators, including pensions and insurance, subject to user willingness. (ANI)

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