The Securities and Exchange Board of India (SEBI) has introduced two new security measures aimed at protecting investors from payment fraud in capital markets: validated UPI handles and a verification tool called SEBI Check. The initiative builds upon SEBI’s recent security measures, including the mandatory ‘1600’ phone series for financial services.
The validated UPI handles system enables brokers and intermediaries to register their payment identifiers with SEBI for official validation and certification. These validated handles, which carry the suffix “@valid,” will be the only ones recognized as legitimate for investor payments in the securities market. The development comes as India’s UPI system undergoes significant evolution, with the National Payments Corporation of India (NPCI) preparing to implement biometric authentication for UPI transactions.
Complementing this system, SEBI Check provides investors with a verification tool to confirm the authenticity of UPI handles before initiating transactions. The tool is being made available at no cost to investors and is planned for integration with existing trading platforms and mobile applications.
“The rollout of validated UPI handles and SEBI Check is expected to significantly reduce fraud risk and eliminate the possibility of funds being transferred to unauthorized entities,” SEBI stated in its announcement.
The implementation addresses growing instances of payment fraud where investors have been deceived into sending funds to fraudulent UPI IDs that impersonate legitimate brokers and market intermediaries. The solution is part of India’s broader efforts to combat digital payment fraud, including the recent Mobile Number Validation (MNV) system that allows financial institutions to verify mobile number ownership.
Market participants and industry experts have acknowledged these measures as important steps forward in securing digital payments for securities investments. The measures support SEBI’s ongoing efforts to strengthen investor protection through technological solutions, including its proposed framework for biometric and SIM binding security measures for trading accounts.
The verification system operates within India’s broader UPI (Unified Payments Interface) framework, which has become a dominant digital payment method in the country’s financial markets. By adding an official validation layer, SEBI aims to maintain the convenience of UPI while enhancing security for capital market transactions. The development comes ahead of the Reserve Bank of India’s new two-factor authentication requirements for digital payments, set to take effect in 2026.
