Centralized KYC System in the Works

Markets regulator Sebi, in collaboration with the Ministry of Finance and other financial regulators, is pushing forward with the development of a centralized Know Your Customer (KYC) system. This initiative aims to simplify compliance by consolidating KYC records into a single, accessible online database for all financial institutions.

Progress and Optimism

Sebi Chairman Tuhin Kanta Pandey shared updates on the progress, emphasizing the effectiveness of the current KYC Registration Agency (KRA) system. "We're really trying to have a system which will be very, very effective," Pandey stated, highlighting the seamless data retrieval across all six interconnected KRAs.

AI's Role in Enhancing Regulatory Processes

Artificial Intelligence (AI) is playing a pivotal role in Sebi's efforts to streamline operations and combat fraud. From market surveillance to processing IPO documents, AI's application is expanding into supervisory technology. Notably, AI-powered surveillance has led to the takedown of over 70,000 fraudulent investment handles on digital platforms.

Challenges and Responsibilities

While AI offers significant benefits, Pandey also cautioned about its risks, especially in algorithmic trading. "AI has both sides," he remarked, underscoring the need for responsible development and use of AI technologies to safeguard the financial ecosystem.