Skip to main content

Sebi proposes Aadhaar-based identification for investors

Sebi proposes Aadhaar-based identification for investors
The Securities and Exchange Board of India (Sebi) is planning identification of stock market investors through their Aadhaar numbers. In its annual report for 2016-17 released on Monday, Chairman Ajay Tyagi said “Sebi will continue to strengthen market supervision through various steps such as Aadhaar-based identification of investors, effective market surveillance and monitoring of compliances by regulated entities.”
The move is in line with the government agenda of making Aadhaar mandatory for opening bank accounts, filing tax returns as well as for any financial transaction of ~50,000 and above. The government in Budget 2017-18 has already mandated linking of the Aadhaar number with the Permanent Account Number (PAN) to avoid creation of multiple accounts for evasion of taxes.
In the annual report, Sebi said it was working on linking Aadhaar with individual demat accounts. 
“Sebi will try to enhance market integrity delisting of suspended/inactive listed companies, linking of individual demat accounts with Aadhaar and further strengthening the framework for market surveillance,” the markets regulator said in its annual report. 
Sebi believes the usage of Aadhaar in the financial market would boost investor confidence. “Aadhaar-linked public policy initiatives, return to a normal monsoon rainfall, and reduced external vulnerabilities were vital for institutional investors’ confidence in the India growth story and also in its markets,” it said.
The report also noted that in FY17 as many as 245 new cases were taken up for investigation compared to 133 fresh ones in FY16, a jump of 84 per cent. Besides, the regulator completed probes into 155 matters in FY17, compared with 123 in FY16.
“There was a comparative increase in the number of cases taken up during 2016-17, mainly due to the references received from the Department of Income Tax in the matter of long-term capital gain and short term capital loss in various scrips,” the regulator noted.
In FY17, 76 per cent (185 of 245) of the cases taken up for investigation pertained to market manipulation and price rigging. Also, insider trading and takeover violation cases accounted for 14 per cent and one per cent, respectively.
"Since several investigation cases involve multiple allegations of violations, their water-tight classification under a specific category becomes difficult. Therefore, cases were classified on the basis of main charge and violation," Sebi said.
Tyagi also indicated tweaking the existing framework. “The securities market is dynamic and its regulatory framework needs to evolve in tandem with this. Sebi will continue to rationalise the regulatory framework to make it contemporary and user-friendly, without compromising on its over-arching objective of investor protection,” he said. 
He also said integration of the commodities markets would remain his priority for the current year. 
“Sebi will take necessary measures for the integration and harmonious development of the commodity derivatives market with the securities market and will explore widening its participants and products to further deepen the commodity derivatives segment,” he said. 
The Business Standard, New Delhi, 16th August 2017

Comments

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm

Credit card spending growth declines on RBI gaze, stress build-up

  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and