All About SEBI's Valid UPI Handles to Prevent Fraudulent Practices

The Securities and Exchange Board of India (SEBI) has introduced two key measures to enhance investor payment security. The “Validated UPI Handles” and “SEBI Check” tools help ensure that payments made to SEBI-registered intermediaries are verified and processed through authorized channels. Let us look at the details of these two initiatives.

Initiative 1: Validated UPI Handles

The first new system is called “Validated UPI Handles,” and it will make payments to investor-facing intermediaries safer and easier. Under this system, UPI IDs of SEBI-registered brokers, mutual funds, and other intermediaries will carry a special “@valid” handle issued by the National Payments Corporation of India (NPCI). The goal is to help investors quickly identify genuine entities and avoid fraudulent activity.

Who is already using it:

1. Major brokerage firms that serve over 90% of retail investors
2. All mutual funds registered with SEBI

This system is optional and works alongside existing payment methods like NEFT, RTGS, and IMPS. Investors can continue using their preferred payment method while benefiting from an extra layer of verification.

Key Features of @Valid UPI Handles and How it Works?

Below are a few key features of Validated UPI handles:

Exclusive Identifier: Every UPI ID will include the “@valid” tag, along with a category-specific suffix that indicates the type of intermediary:

• .brk for brokers (example: abc.brk@validicici)

• .mf for mutual funds (example: xyz.mf@validicici)

This makes it easy for investors to immediately recognize that the UPI ID belongs to a legitimate SEBI-registered entity.

Visual Verification: When making a payment through a validated UPI handle, a “thumbs-up inside a green triangle” icon will appear on the transaction screen. This confirms that the payment is going to a verified intermediary. If you don’t see the icon, treat it as a warning and avoid making the payment.

Distinctive QR Code: Each intermediary will have a special QR code with the thumbs-up symbol at the centre. Scanning this QR code ensures that payments are made directly to the registered entity without error.

Initiative 2: SEBI Check

The second initiative, called “SEBI Check”, is designed to help investors verify SEBI registration of intermediaries before making payments or investments. This tool ensures that you are dealing with genuine brokers, mutual funds, or other SEBI-registered entities and not falling victim to fraud.

How SEBI Check Works?

Instant Verification of Entities: Investors can enter the name, UPI handle, or registration number of a broker, mutual fund, or other intermediary in the SEBI Check portal or app. The system instantly confirms whether the entity is registered with SEBI and allowed to accept payments from investors.

Category-wise Details: The SEBI Check also displays the type of intermediary, such as a broker, mutual fund, depository participant, or investment adviser. This helps investors understand the exact services the intermediary is authorized to provide.

Red Flags for Unregistered Entities: If the intermediary is not registered with SEBI, the tool will immediately alert the investor. This prevents accidental payments to fraudulent or unauthorized parties.

Integration with Other Payment Tools: SEBI Check can be used in conjunction with the Validated UPI Handles system. For example, before sending money via a “@valid” handle, investors can cross-check the intermediary on SEBI Check for additional assurance.

How Will These New Initiatives Help Investors?

• It protects investors from scams by making sure payments are only made to verified intermediaries.

• It provides transparency, so investors know exactly who they are dealing with and their regulatory permissions.

• It complements other payment methods and verification tools, making the investment ecosystem safer for everyone.

Before you go

Together, Validated UPI Handles and SEBI Check provide investors with a robust, two-layered safety net when making payments to SEBI-registered intermediaries. While the “@valid” UPI handles offer a quick, visual confirmation and an error-free payment process through unique identifiers, category-specific suffixes, and distinctive QR codes, SEBI Check adds an extra layer of assurance by allowing investors to verify the registration and legitimacy of intermediaries in real-time.

Combined, these initiatives make investing and transacting in India safer, more transparent, and easier for all investors, reducing the risk of fraud and boosting confidence in the financial system.