Kolkata: Working on the long-term goal to take equity investing in India to the next level, capital markets regulator Sebi has been announcing significant reform measures recently. Two of the areas it focused on are making the process easier for FPIs to invest in India through less compliance and smoother registration process. It has also made the process easier for companies to float big IPOs.
The next big task that Sebi has taken up is to ease the process of non-resident Indians invest in Indian stock markets. An area of concern seems to be complying with the KYC (know your customer) requirements, for which NRIs have to travel to India. “We are yet to establish an easy and secure KYC access for NRIs to facilitate their participation in the securities market. This will be an urgent goal for us,” Tuhin Kanta Pandey, chairman of Sebi remarked in a meeting organised by the Bombay Stock Exchange Brokers’ Forum.
Sebi is in talks with the Reserve Bank of India and the Unique Identification Authority of India to devise a system which can allow an NRI to comply with the KYC requirements without visiting India.
NRIs can be a big fillip
If NRI money can flow into Indian equity markets, it can be in for a significant fillip since India enjoys the biggest remittance amounts in the world consistently year after year with the latest figure being $135 billion in FY25. Unlocking this potential could lift the market from its current condition when some FPI investments have moved out and there are signs of some ebbing in domestic retail investor interest.
“We are already consulting our stakeholders to implement it …we would like to be among the best in the world in terms of facilitating registration,” said Pandey on the issue of creating a single window for trusted FPI investors and smoother compliance requirements.
The Sebi chairman said on the topic of surveillance that the regulator is shifting from reactive supervision to predictive oversight. Pandey admitted that the Chhota SIP has failed to become popular but also said that the small SIP can create a significant impact if the way in its progress is made smooth.