SEBI Chairman flags digital-era risks, calls for stronger financial awareness

SEBI Chairman flags digital-era risks, Calls for stronger financial Awareness

SEBI Chairman Tuhin Kanta Pandey on Thursday emphasised the urgent need for deeper financial awareness amid rising investor participation and growing digital risks, warning that misinformation, fraudulent apps and online persuasion are increasingly shaping household financial decisions.

Speaking at the BSE Regional Seminar on Investor Awareness in Coimbatore, Pandey said investment choices today often begin with forwarded messages, viral videos or social media recommendations rather than verified financial knowledge. He said, “These moments may appear harmless, yet they influence financial choices that can reshape household savings, expectations, and financial stability”.

Pandey said, securities market has expanded rapidly, with the number of unique investors touching 13.6 crore as of October 2025, up from less than 4 crore in FY19. Mutual fund investors have grown from 1 crore to 5.6 crore in a decade, while monthly SIP flows have jumped from Rs 3,000 crore in 2016 to over Rs 29,000 crore.

However, SEBI’s Investor Survey 2025 shows a gap between awareness and actual investing: while 63 percent of households know about market products, only 9.5 percent invest. Rural participation remains significantly lower at just 6 percent. He stated that “These figures remind us that financial inclusion must also be geographic and social”.

Warning that “misinformation spreads faster than facts,” Pandey said fraudulent trading apps, deep fake impersonations, and unregistered advisers continue to deceive investors. SEBI has escalated over 1 lakh cases of misleading online content to platforms such as Meta, Google, Telegram and X in the last 18 months.

To combat scams, SEBI has introduced multiple safety features like Validated UPI handle framework to ensure payments only to verified intermediaries. SEBI Check to verify bank accounts of registered entities. Account freeze option for investors to block trading accounts instantly. Spot a Scam tool to help users detect fraudulent schemes. SEBI vs SCAM nationwide awareness campaign to highlight tactics used in fake apps, guaranteed-return schemes, and dabba trading.

Pandey highlighted structural reforms aimed at protecting investors, including, direct pay out mechanisms for faster, safer fund and securities credit. ASBA-like blocked amount system for secondary markets. Replacement of Power of Attorney with a secure Demat Debit Pledge framework. Integration with Digilocker for safe storage of demat and mutual fund holdings. Simplified nomination processes and a centralised reporting mechanism for handling claims after an investor’s demise.

Pandey urged investors to “pause before acting, verify before trusting and learn before investing,” emphasising that awareness fosters resilience and confidence in financial decision-making.