In a major move aimed at securing the digital investment ecosystem, the Securities and Exchange Board of India (SEBI) has announced a new rule that will directly impact stock market investors, mutual fund subscribers, and anyone involved in online financial investments. Starting from 1st October 2025, a new system will be implemented to ensure that investors can verify that their money is being transferred to legitimate financial entities. This change comes as digital transactions continue to rise, and with them, so do instances of online fraud.
Under this new system, all brokers, mutual fund companies, portfolio managers, investment advisers, merchant bankers, syndicate banks, and other financial entities registered with SEBI will now be required to use a specific kind of UPI ID that ends with "@valid". For example, if a company named ABC is registered with SEBI, its new UPI ID might look like: ABC.Bkr@valid. The idea behind this is simple but powerful — whenever an investor transfers funds to a broker or mutual fund, they can immediately identify whether the recipient is a genuine SEBI-recognized entity.
This new rule introduces several key benefits for investors. Firstly, investors will now be able to quickly confirm whether they are sending money to a genuine registered entity. When sending funds, their mobile screens will display a green triangle and a thumbs-up icon to indicate that the receiving company is verified and safe. Secondly, one of the biggest challenges in today's digital world is the rise in scams where fraudsters create fake websites or clone legitimate company names to deceive investors. With this mandatory "@valid" UPI ID system, it becomes almost impossible for unregistered or fraudulent entities to receive funds, significantly reducing the chances of scams. Thirdly, SEBI is also introducing a "SEBI Check Tool," a simple yet effective tool that allows investors to manually verify any UPI ID. By simply typing in the UPI ID or scanning a QR code, investors can instantly check whether the recipient is legitimate or not.
One major concern for many investors might be whether they need to change their existing UPI setup to comply with this rule. The answer is no. Investors do not need to make any changes to their UPI accounts or IDs. They can continue using their existing UPI platforms such as Google Pay, PhonePe, Paytm, etc., as before. The only responsibility they have is to ensure that when transferring funds to brokers, mutual funds, or any investment-related firms, they are using the company’s "@valid" UPI ID and seeing the green triangle verification on their screen.
With the majority of financial transactions now happening online, fraudulent activities targeting investors have increased significantly. Fraudsters often create fake UPI IDs or websites that look very similar to genuine ones, making it difficult for investors to distinguish between real and fake companies. SEBI’s move aims to block these fraudsters at the payment stage itself, by only allowing verified financial institutions to receive investment funds via the "@valid" UPI ID system. This system will cover a wide range of financial market participants including stock brokers, mutual fund companies, portfolio managers, investment advisers, merchant bankers, and syndicate banks.
SEBI's latest initiative is a significant step forward in creating a safer and more trustworthy digital payment environment for investors. By introducing verified UPI IDs and an easy-to-use verification tool, SEBI is empowering investors with the ability to independently check the legitimacy of the companies they deal with. Investors are strongly advised to always look for the "@valid" UPI ID before making any payments, use SEBI’s verification tool before every transaction, and avoid sending money to any company that does not have the official verification symbol.
SEBI’s new "@valid" UPI ID rule is a game-changer for India’s financial markets, providing a robust layer of protection against online investment fraud. As we move towards a more digitally connected financial world, such measures are crucial to maintaining investor confidence and security. Going forward, investors should make it a habit to double-check UPI IDs and leverage the new SEBI Check Tool before making any financial transactions.
Disclaimer:
The information provided in this article is for informational purposes only. Readers are advised to verify any financial decisions with official sources and consult a qualified financial advisor if necessary. The author and the blog are not responsible for any financial loss or damages arising from the use of the information provided herein.
