The Securities and Exchange Board of India (Sebi) is simplifying the registration process for aspiring research analysts (RAs) and investment advisors (IAs), according to sources.
The new framework is likely to be out within a month, they said. Documentation and verification steps are likely to come down to a third, they said. While the simplification process is to facilitate genuine entities, it will not be allowed to compromise the regulator's gatekeeping function of keeping fraudsters out, added the source.
Moneycontrol has sent an email to Sebi and the article will be updated once the response comes in. A spokesperson for the Bombay Stock Exchange (BSE), which is the administrative and supervisory body for both RAs and IAs, said in response to a query from Moneycontrol : "Sebi amendments are expected. Till the amendments are passed, we won't be able to comment on them."
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Comprehensive review
According to an industry source, Sebi has identified several issues, technical as well as procedural, in the processing of applications, both at the BSE and the Sebi online portal.
"These issues have caused delays in the submission, review and approval of applications, impacting stakeholders and market participants," the source said.
"To address these concerns, the regulator is learned to be doing a comprehensive review of the existing processes and documentation requirements . The objective of this initiative is to streamline and optimise the application process, enabling faster filing, more efficient processing, and expedited clearance of applications," the source added.
Currently, under the registration process, an RA or IA application first goes to the BSE, which does the initial checks. The BSE seeks more documentation and data wherever needed and forwards it to Sebi for final approval.
The whole process--from application being sent to the BSE to the final go-ahead from Sebi --takes a few months, in many cases. According to the Sebi website, the regulator tries to clear the application from its end within 30 days. An industry source said that the regulatory officials have been making a concerted effort to stick to this deadline.
This 30-day period is needed for the regulator to ensure that the credentials of the applicants are valid, given the rampant cyberfrauds, and to ensure that the regulator's gatekeeping responsibility is not compromised, the source said.
To encourage more people to register with Sebi, the regulator had even introduced the concept of part-time IAs and part-time RAs. On January 8, 2025, the regulator has issued guidelines for IAs and RAs after reviewing the existing framework.
The online registration process for this has now gone live.
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