SEBI Chairman Tuhin Kanta Pandey announces a graded compliance framework for stockbrokers to tailor regulatory burdens based on scale and tech usage while focusing on market infrastructure, liquidity, and robust cybersecurity standards.
SEBI to Introduce Graded Compliance for Stockbrokers
Mumbai (Maharashtra) [India], October 24 (ANI): Market regulator Securities and Exchange Board of India (SEBI) is exploring a graded compliance framework for stockbrokers, Chairman Tuhin Kanta Pandey announced on Saturday. Addressing market intermediaries at the 16th ANMI International Capital Market Convention in Mumbai, he said that the new framework would tailor regulatory burdens to market realities.
“For stockbrokers, we are exploring graded compliance. It would reflect your scale, your client exposure, and your reliance on technology,” Pandey said, emphasising that supervision needs to be balanced against operational risks.
Deepening Debt Markets and Tech Infrastructure
Highlighting the need to deepen India's debt market, the SEBI chief stated that the regulator is focused on improving liquidity and market infrastructure beyond equities. “A market-making framework is being developed to lift secondary trading in corporate bonds,” he revealed.
Pandey added that technological evolution will drive the next phase of market infrastructure, announcing upcoming structural innovations for corporate debt instruments. “In the next phase of Demat 2.0, tokenised corporate bonds will trade in the secondary market, bringing better liquidity, lower settlement risk, and faster access to funds,” he said.
Innovation, Cybersecurity, and Market Reforms
Outlining SEBI’s stance on technological advancements, Pandey stated that regulation must foster innovation while mitigating systemic risks. “We are exploring an AI sandbox where new tools can be tested safely. While innovators gain regulatory certainty, we gain the right safeguards,” he noted.
The SEBI Chairman cautioned intermediaries against cyber risks and operational disruptions, urging firms to prioritise resilience over routine compliance. “So please treat cybersecurity as a business priority, not an IT expense. Test your systems. Plan for failure,” Pandey warned.
Summarising the market regulator's direction, Pandey detailed SEBI's overall agenda for market development. “Our roadmap has four parts: simpler rules, deeper markets, responsible technology, and wider access,” he reiterated. He also highlighted ongoing reforms targeting depository participants to make compliance seamless while bolstering risk containment measures. “We are reworking the rules for depository participants for simpler compliance and stronger defences against fraud,” Pandey said.
Additionally, the regulator is reviewing core trading mechanisms to ensure price discovery and liquidity remain robust across instruments. “We are reviewing short selling and securities lending and borrowing to improve liquidity and price discovery,” Pandey concluded.
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