SEBI Collaborates with DigiLocker to Mitigate Unclaimed Assets and Fortify Investor Safeguards
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Synopsis
SEBI's collaboration with DigiLocker aims to enhance investor protection by allowing secure tracking of securities holdings and minimizing unclaimed assets through a streamlined process involving nominee access.
Key Takeaways
- SEBI has partnered with DigiLocker.
- Focus on reducing unclaimed financial assets.
- Introduction of nomination facility for heirs.
- Automated notifications for asset transfer.
- Upcoming regulatory changes discussed in board meeting.
New Delhi, March 19 (NationPress) The Securities and Exchange Board of India (SEBI) has entered into a partnership with DigiLocker to assist investors in monitoring their securities holdings while addressing the issue of unclaimed financial assets.
This initiative is detailed in SEBI's circular titled "Leveraging DigiLocker as a Digital Public Infrastructure to Minimize Unclaimed Assets in the Indian Securities Market," with the objective of enhancing investor protection and facilitating access to financial holdings.
By linking DigiLocker with the securities market, SEBI is providing investors a secure means to store and retrieve information regarding their demat accounts and mutual fund holdings.
DigiLocker, which already offers access to bank account statements, insurance policies, and details regarding the National Pension System (NPS), will now function as a centralized platform for investors to manage their securities data.
A notable feature of this initiative is the nomination facility introduced by the government.
Investors can designate data access nominees within DigiLocker, giving them read-only access to the account in the event of the investor's passing.
"This ensures that legal heirs can promptly locate and claim financial assets without unnecessary delays," stated the government.
To facilitate the process, SEBI has introduced an automated notification system for nominees.
In the event of an investor's demise, the KYC Registration Agencies (KRAs), which are registered and regulated by SEBI, will inform DigiLocker.
Upon notification, DigiLocker will automatically notify the designated individuals, allowing them to initiate the asset transfer process with financial institutions.
The KRAs will be crucial in verifying information and ensuring a smooth transition of assets to rightful heirs.
Furthermore, the market regulator is set to deliberate on significant regulatory changes in its forthcoming board meeting, marking the first under the guidance of new Chairperson Tuhin Kanta Pandey.
The agenda encompasses new security protocols for demat accounts, ensuring the autonomy of clearing corporations, broadening the definition of Qualified Institutional Buyers (QIBs), and amending fee collection guidelines for research analysts.
One significant proposal aims to bolster investor security by implementing a system akin to the Unified Payments Interface (UPI) for demat accounts.
