In a proactive move aimed at safeguarding investors from receiving misguided financial advice from unregistered sources, SEBI (Securities and Exchange Board of India) is introducing a novel mechanism. The proposal mandates that all fees paid by investors to financial advisors will be funneled through a specially designated platform overseen by a SEBI-recognised authority.

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The primary objective of this proposal is to ensure that payments made by investors exclusively reach registered investment advisors and research analysts.

By doing so, SEBI aims to establish a clear and transparent payment trail while simultaneously isolating and preventing unregistered advisors and analysts from engaging in financial dealings with investors.

Under this system, all research and investment advisors will be listed on the designated platform and will be required to furnish their bank account details for the seamless processing of payments.