Mumbai: The Securities and Exchange Board of India (Sebi) is set to launch a multi-pronged assault on investment fraud, combining new technology safeguards with a significant physical expansion across the country to protect a rapidly growing base of retail investors.

Sebi chairperson Tuhin Kanta Pandey on Monday announced plans to introduce new digital tools to fight online scams and open offices in state capitals and other major cities to fight online fraud and improve investor awareness. He was speaking at the inauguration of the World Investor Week 2025 at the National Stock Exchange.

Pandey also highlighted the vast disconnect between market awareness and actual retail investor participation. A recent Sebi-commissioned investor survey of over 90,000 households revealed that 63% of Indian households were aware of securities products but only 9.5% had actually invested.

“This knowledge gap is a vulnerability that exposes our investors to risks and makes them susceptible to fraud,” Pandey said.

The number of unique investors in India has swelled to about 134 million, but only 36% possess high or moderate knowledge of the market, according to Sebi’s survey.

This has created a fertile ground for fraudsters using digital tools, unsolicited messages, and financial influencers to promise “guaranteed returns”—a concept that Pandey said went against the very nature of the markets.

Responsible investing—the ultimate shield

Pandey said Sebi is actively identifying posts by unregistered finfluencers and flagging them to platform providers like Google and Meta for removal. Over the previous 18 months alone, more than 100,000 such misleading posts have been flagged, he said.

Pandey also announced that Sebi would establish offices in state capitals and other major cities to improve investor connection, monitor unregulated activities, and gather market intelligence. Speaking on the sidelines, the Sebi chief named cities such as Lucknow, Vijayawada, Bengaluru, and Chandigarh as locations for these new offices.

Starting this month, Sebi has introduced a “validated UPI handle” mechanism. All payments to Sebi-registered intermediaries must now use a UPI ID with a special handle and a visual thumbs-up icon, providing investors with an immediate warning sign against fraudulent channels.

An accompanying ‘Sebi Check’ tool has been launched for investors to verify an intermediary’s payment channels.

Responsible investing is the ultimate shield, Pandey said, urging investors to use credible sources, question unrealistic promises, and understand their own financial goals and risk tolerance.

With 22% of non-investors expected to enter the market over the next year, Sebi’s mission, Pandey concluded, is to empower this new wave of retail investors with the knowledge to invest safely and confidently.