Mandatory UPI Compliance for SEBI-Registered Investment Advisers (RIA) and Research Analysts (RA)

Mandatory UPI Compliance for SEBI-Registered Investment Advisers (RIA) and Research Analysts (RA). SEBI UPI Handel
The Securities and Exchange Board of India (Securities and Exchange Board of India) has consistently tightened operational and payment-related controls for regulated intermediaries to enhance investor protection and eliminate misuse of unregulated payment channels. In continuation of this approach, SEBI issued a landmark Circular No.: SEBI/HO/DEPA-II/DEPA-II_SRG/P/CIR/2025/86 in June 2025 mandating the adoption of standardised, validated, and exclusive UPI IDs for payment collection by SEBI-registered intermediaries from investors.
This SEBI regulatory change directly impacts SEBI-registered Investment Advisers (RIAs) and Research Analysts (RAs) who collect fees, subscription charges, or any form of consideration from investors. While UPI has been widely used for convenience, SEBI has now brought it firmly within the compliance framework, making informal or personal UPI usage impermissible.
At CCL, Will explains the legal basis, applicability, compliance scope, implementation mechanism, timelines, and practical implications of the UPI mandate for RIAs and RAs, in a detailed and structured manner for better understanding of compliances for RA/RIA business owners to avoid any future SEBI adjudication orders and notices.
SEBI, vide its circular dated June 11, 2025, titled:
“Adoption of Standardised, Validated and Exclusive UPI IDs for Payment Collection by SEBI Registered Intermediaries from Investors”
mandated that regulated intermediaries must adopt exclusive and validated UPI IDs for collecting payments from investors. This SEBI circular applies across multiple intermediary categories and establishes a uniform payment identification mechanism that allows investors to verify the authenticity of the intermediary before making any payment.
Why SEBI Introduced exclusive UPI IDs for RA/RIA
Over the past few years, SEBI observed a rising number of investor complaints involving:

Payments made to personal UPI IDs of individuals claiming to be advisers or analysts

Misuse of unregistered payment handles not linked to regulated entities

Difficulty in tracing transactions during enforcement actions

Fraudulent entities impersonating SEBI-registered intermediaries

Despite strict registration requirements under the SEBI Investment Advisers Regulations, 2013 and SEBI Research Analysts Regulations, 2014, payment collection largely remained outside a standardised regulatory system.
Applicability to Investment Advisers (RIA) and Research Analysts (RA)
Are RIAs and RAs Covered Under This Circular?
Yes, Although the circular uses the broader term “SEBI-registered intermediaries”, RIAs and RAs fall squarely within its scope if they collect any consideration from investors through UPI and includes:

Advisory fees

Research subscription charges

Retainer fees

Periodic advisory plans

One-time consultation fees

Whether the RIA/RA operates as:

an individual,

a partnership or LLP, or

a company,

the obligation remains the same.
Mandatory Nature of Validated UPI for RIAs and RAs
Is UPI Mandatory as a Payment Mode?
No, SEBI has not made UPI compulsory as the only payment mode.
What Is Mandatory Then?
If UPI is offered or used, it must only be through a SEBI-validated and exclusive UPI ID and Other modes such as:

NEFT

RTGS

IMPS

Cheque

remain permitted. However, UPI payments outside the validated framework are prohibited.
Meaning of “Standardised, Validated and Exclusive” UPI ID
1. Standardised:The UPI ID follows a uniform structure prescribed by SEBI and NPCI. This allows instant recognition that the payment handle belongs to a regulated intermediary.
2. Validated: The UPI ID is:

verified against SEBI registration data

approved by the designated stock exchange

linked to the intermediary’s registered bank account

3. Exclusive
The UPI ID:

cannot be shared with any other business or individual

cannot be reused across entities

must be used only for investor payments related to SEBI-regulated activities

Prohibited Practices After the SEBI Circular for UPI
Once the circular becomes effective, not allowed to:

Using personal UPI IDs (individual phone-linked UPI)

Accepting investor payments via employee or director UPI IDs

Collecting fees through unregistered aggregator handles

Accepting advisory fees on third-party UPI accounts

Effective Date and Implementation Timeline
Applicable or shall be effective from 1 October 2025 – Investors will be able to make payments using validated UPI IDs
RIAs and RAs are expected to:

apply for validated UPI IDs in advance

update payment instructions

modify onboarding documents and fee invoices

How RIAs and RAs Obtain a Validated UPI ID
Step 1: Eligibility Confirmation

Active SEBI registration

Valid bank account in entity name

PAN and registration details matching SEBI records

Step 2: Application Through Exchange-Designated Mechanism
SEBI has designated stock exchanges as implementation agencies. The application is routed through:

the exchange where the intermediary is registered or administered

integrated portals aligned with SEBI’s supervision framework

Step 3: Bank & NPCI Validation

Bank verifies account ownership

NPCI maps the UPI handle to SEBI registration

Exchange approves activation

Step 4: Activation of UPI Handle
Once activated, the UPI ID becomes visible as a validated handle when investors attempt to make payments.
Visibility to Investors: “SEBI-Validated” Indicator
A major investor-protection feature is front-end visibility.
When an investor enters a validated UPI ID:

the intermediary’s registered name is displayed

confirmation appears that the handle is SEBI-validated

This drastically reduces impersonation and payment fraud.
Impact on Existing RIA and RA Business Models
1. Fee Collection Process
RIAs and RAs must:

replace old UPI IDs on websites, invoices, brochures

update client agreements

re-educate existing clients

2. Subscription-Based Research Models
RAs offering:

monthly or annual plans

algorithm-linked research access

platform-based subscriptions

must ensure all UPI payment links are migrated.
3. LLP and Company Structures
For LLPs and companies:

UPI ID must be linked to the entity bank account, not partner/director accounts

Multiple UPI IDs may be permitted, subject to SEBI approval

Record-Keeping and Audit Trail
Validated UPI IDs strengthen:

audit trails during SEBI inspections

reconciliation of fee income

linkage with books of accounts

verification during grievance redressal

This also aligns with broader compliance obligations under:

SEBI regulations

Income-tax Act

AML and KYC norms

Consequences of Non-Compliance
Failure to comply may result in:

regulatory observations during inspections

directions to stop fee collection

penalties under SEBI Act

suspension of registration in severe cases

Importantly, accepting fees through unvalidated UPI IDs after the effective date can itself be treated as a regulatory violation, irrespective of intent.
Interaction with Other SEBI Compliance Requirements
The UPI mandate integrates with:

Investor grievance mechanisms

SCORES-linked dispute resolution

CeFCoM compliance architecture

Payment traceability norms

Practical Compliance Checklist for RIAs and RAs
Before October 2025, every RIA and RA should:

Review all existing payment modes

Identify UPI usage points

Apply for validated UPI ID

Update client-facing documents

Train internal teams

Inform investors formally

Why SEBI UPI Circular is a Structural Shift, Not a Cosmetic Change
Historically, payment compliance was weakly enforced in advisory and research segments. For compliant RIAs and RAs, it also creates differentiation, as investors increasingly prefer verified and traceable payment channels.
This circular:

closes regulatory blind spots

eliminates informal fee practices

enhances investor confidence

improves enforcement capability

Role of Professional Compliance Support
Implementation requires coordination between:

SEBI regulations

exchange processes

banking systems

investor communication

Professional assistance ensures:

correct application routing

avoidance of rejection

alignment with broader SEBI compliance

Therefore, The SEBI mandate on standardised, validated and exclusive UPI IDs marks a decisive step toward payment discipline in the advisory and research ecosystem. For SEBI-registered Investment Advisers and Research Analysts, UPI can no longer be treated as an informal convenience tool. It is now a regulated payment infrastructure, subject to validation, exclusivity, and audit scrutiny.Compliance Calendar LLP assists SEBI-registered Investment Advisers and Research Analysts in implementing validated UPI compliance, exchange coordination, documentation updates, and end-to-end regulatory readiness.
Some FAQ’s on UPI handel
Q1. Is UPI mandatory for SEBI registered Investment Advisers?
Ans. UPI itself is not mandatory, but if an Investment Adviser accepts payments through UPI, it must be only via a SEBI-validated and exclusive UPI ID.
Q2. Does the UPI mandate apply to Research Analysts also?
Ans. Yes. SEBI-registered Research Analysts collecting subscription or advisory fees through UPI must use validated UPI IDs.
Q3. From when is the validated UPI requirement effective?
Ans. The investor-facing implementation date is 1 October 2025.
Q4. Can RIAs and RAs continue using personal UPI IDs?
Ans. No. Personal or individual UPI IDs are strictly prohibited for collecting investor payments after implementation.
Q5. Is this rule applicable to individual RIAs?
Ans. Yes. The rule applies irrespective of whether the RIA is an individual, LLP, partnership, or company.
Q6. Can investors still pay through NEFT or RTGS?
Ans. Yes. Other banking modes remain permitted. The restriction applies only when UPI is used.
Q7. What is a SEBI-validated UPI ID?
Ans. It is a UPI handle verified by SEBI through exchanges and NPCI, confirming that it belongs to a registered intermediary.
Q8. Can an RIA have multiple validated UPI IDs?
Ans. Yes, subject to SEBI/exchange approval and linkage to registered bank accounts.
Q9. Is this UPI ID linked to SEBI registration?
Ans. Yes. The UPI ID is mapped to the intermediary’s SEBI registration details.
Q10. Will investors see confirmation before payment?
Ans. Yes. The system displays the registered intermediary name when a validated UPI ID is entered.
Q11. Does this apply to subscription-based research models?
Ans. Yes. Any UPI-based subscription payment must use a validated handle.
Q12. Is cash payment allowed after this circular?
Ans. Cash payments are discouraged and may raise audit and AML concerns, though not expressly covered under this circular.
Q13. What happens if an RIA violates this rule?
Ans. SEBI may initiate inspection, impose penalties, or issue directions including suspension.
Q14. Is this applicable to unregistered advisers?
Ans. No. However, unregistered advisers are already prohibited from collecting advisory fees.
Q15. Will this impact existing client agreements?
Ans. Yes. Payment clauses and fee instructions should be updated.
Q16. Is GST impacted by this change?
Ans. No direct change, but validated UPI improves reconciliation and audit trails.
Q17. Can advisory staff collect payments on behalf of the RIA?
Ans. No. Payments must flow directly into the registered intermediary’s account.
Q18. Will SEBI track payments through UPI?
Ans. Yes. The framework enables traceability and enforcement.
Q19. Is this linked with SCORES or grievance handling?
Ans. Indirectly yes, as payment verification becomes easier during disputes.
Q20. Can old UPI IDs be used till September 2025?
Ans. Yes, but intermediaries should migrate well in advance.
Q21. Does this rule apply to foreign clients?
Ans. Yes, if UPI is used for payment collection in India.
Q22. Will exchanges monitor compliance?
Ans. Yes. Stock exchanges act as supervisory and implementation agencies.
Q23. Is this requirement part of RIA annual compliance?
Ans. Yes. It forms part of operational and conduct compliance.
Q24. Can failure impact SEBI renewal?
Ans. Yes. Repeated non-compliance may affect renewal or continuation.
Q25. How can RIAs ensure smooth implementation?
Ans. By applying early, updating documents, and informing clients proactively.

SEBI UPI Handel

The Securities and Exchange Board of India (Securities and Exchange Board of India) has consistently tightened operational and payment-related controls for regulated intermediaries to enhance investor protection and eliminate misuse of unregulated payment channels. In continuation of this approach, SEBI issued a landmark Circular No.: SEBI/HO/DEPA-II/DEPA-II_SRG/P/CIR/2025/86 in June 2025 mandating the adoption of standardised, validated, and exclusive UPI IDs for payment collection by SEBI-registered intermediaries from investors.

This SEBI regulatory change directly impacts SEBI-registered Investment Advisers (RIAs) and Research Analysts (RAs) who collect fees, subscription charges, or any form of consideration from investors. While UPI has been widely used for convenience, SEBI has now brought it firmly within the compliance framework, making informal or personal UPI usage impermissible.

At CCL, Will explains the legal basis, applicability, compliance scope, implementation mechanism, timelines, and practical implications of the UPI mandate for RIAs and RAs, in a detailed and structured manner for better understanding of compliances for RA/RIA business owners to avoid any future SEBI adjudication orders and notices.

SEBI, vide its circular dated June 11, 2025, titled:

“Adoption of Standardised, Validated and Exclusive UPI IDs for Payment Collection by SEBI Registered Intermediaries from Investors”

mandated that regulated intermediaries must adopt exclusive and validated UPI IDs for collecting payments from investors. This SEBI circular applies across multiple intermediary categories and establishes a uniform payment identification mechanism that allows investors to verify the authenticity of the intermediary before making any payment.

Why SEBI Introduced exclusive UPI IDs for RA/RIA

Over the past few years, SEBI observed a rising number of investor complaints involving:

Payments made to personal UPI IDs of individuals claiming to be advisers or analysts
Misuse of unregistered payment handles not linked to regulated entities
Difficulty in tracing transactions during enforcement actions
Fraudulent entities impersonating SEBI-registered intermediaries

Applicability to Investment Advisers (RIA) and Research Analysts (RA)

Are RIAs and RAs Covered Under This Circular?

Yes, Although the circular uses the broader term “SEBI-registered intermediaries”, RIAs and RAs fall squarely within its scope if they collect any consideration from investors through UPI and includes:

Advisory fees
Research subscription charges
Retainer fees
Periodic advisory plans
One-time consultation fees

Whether the RIA/RA operates as:

an individual,
a partnership or LLP, or
a company,

the obligation remains the same.

Mandatory Nature of Validated UPI for RIAs and RAs

Is UPI Mandatory as a Payment Mode?

No, SEBI has not made UPI compulsory as the only payment mode.

What Is Mandatory Then?

If UPI is offered or used, it must only be through a SEBI-validated and exclusive UPI ID and Other modes such as:

NEFT
RTGS
IMPS
Cheque

remain permitted. However, UPI payments outside the validated framework are prohibited.

Meaning of “Standardised, Validated and Exclusive” UPI ID

1. Standardised:The UPI ID follows a uniform structure prescribed by SEBI and NPCI.
This allows instant recognition that the payment handle belongs to a regulated intermediary.

2. Validated: The UPI ID is:

verified against SEBI registration data
approved by the designated stock exchange
linked to the intermediary’s registered bank account

3. Exclusive

The UPI ID:

cannot be shared with any other business or individual
cannot be reused across entities
must be used only for investor payments related to SEBI-regulated activities

Prohibited Practices After the SEBI Circular for UPI

Once the circular becomes effective, not allowed to:

Using personal UPI IDs (individual phone-linked UPI)
Accepting investor payments via employee or director UPI IDs
Collecting fees through unregistered aggregator handles
Accepting advisory fees on third-party UPI accounts

Effective Date and Implementation Timeline

Applicable or shall be effective from 1 October 2025 – Investors will be able to make payments using validated UPI IDs

RIAs and RAs are expected to:

apply for validated UPI IDs in advance
update payment instructions
modify onboarding documents and fee invoices

How RIAs and RAs Obtain a Validated UPI ID

Step 1: Eligibility Confirmation

Active SEBI registration
Valid bank account in entity name
PAN and registration details matching SEBI records

Step 2: Application Through Exchange-Designated Mechanism

SEBI has designated stock exchanges as implementation agencies.
The application is routed through:

the exchange where the intermediary is registered or administered
integrated portals aligned with SEBI’s supervision framework

Step 3: Bank & NPCI Validation

Bank verifies account ownership
NPCI maps the UPI handle to SEBI registration
Exchange approves activation

Step 4: Activation of UPI Handle

Once activated, the UPI ID becomes visible as a validated handle when investors attempt to make payments.

Visibility to Investors: “SEBI-Validated” Indicator

A major investor-protection feature is front-end visibility.

When an investor enters a validated UPI ID:

the intermediary’s registered name is displayed
confirmation appears that the handle is SEBI-validated

This drastically reduces impersonation and payment fraud.

Impact on Existing RIA and RA Business Models

1. Fee Collection Process

RIAs and RAs must:

replace old UPI IDs on websites, invoices, brochures
update client agreements
re-educate existing clients

2. Subscription-Based Research Models

RAs offering:

monthly or annual plans
algorithm-linked research access
platform-based subscriptions

must ensure all UPI payment links are migrated.

3. LLP and Company Structures

For LLPs and companies:

UPI ID must be linked to the entity bank account, not partner/director accounts
Multiple UPI IDs may be permitted, subject to SEBI approval

Record-Keeping and Audit Trail

Validated UPI IDs strengthen:

audit trails during SEBI inspections
reconciliation of fee income
linkage with books of accounts
verification during grievance redressal

This also aligns with broader compliance obligations under:

SEBI regulations
Income-tax Act
AML and KYC norms

Consequences of Non-Compliance

Failure to comply may result in:

regulatory observations during inspections
directions to stop fee collection
penalties under SEBI Act
suspension of registration in severe cases

Importantly, accepting fees through unvalidated UPI IDs after the effective date can itself be treated as a regulatory violation, irrespective of intent.

Interaction with Other SEBI Compliance Requirements

The UPI mandate integrates with:

Investor grievance mechanisms
SCORES-linked dispute resolution
CeFCoM compliance architecture
Payment traceability norms

Practical Compliance Checklist for RIAs and RAs

Before October 2025, every RIA and RA should:

Review all existing payment modes
Identify UPI usage points
Apply for validated UPI ID
Update client-facing documents
Train internal teams
Inform investors formally

Why SEBI UPI Circular is a Structural Shift, Not a Cosmetic Change

Historically, payment compliance was weakly enforced in advisory and research segments. For compliant RIAs and RAs, it also creates differentiation, as investors increasingly prefer verified and traceable payment channels.

This circular:

closes regulatory blind spots
eliminates informal fee practices
enhances investor confidence
improves enforcement capability

Role of Professional Compliance Support

Implementation requires coordination between:

SEBI regulations
exchange processes
banking systems
investor communication

Professional assistance ensures:

correct application routing
avoidance of rejection
alignment with broader SEBI compliance

Some FAQ’s on UPI handel

Q1. Is UPI mandatory for SEBI registered Investment Advisers?

Ans. UPI itself is not mandatory, but if an Investment Adviser accepts payments through UPI, it must be only via a SEBI-validated and exclusive UPI ID.

Q2. Does the UPI mandate apply to Research Analysts also?

Ans. Yes. SEBI-registered Research Analysts collecting subscription or advisory fees through UPI must use validated UPI IDs.

Q3. From when is the validated UPI requirement effective?

Ans. The investor-facing implementation date is 1 October 2025.

Q4. Can RIAs and RAs continue using personal UPI IDs?

Ans. No. Personal or individual UPI IDs are strictly prohibited for collecting investor payments after implementation.

Q5. Is this rule applicable to individual RIAs?

Ans. Yes. The rule applies irrespective of whether the RIA is an individual, LLP, partnership, or company.

Q6. Can investors still pay through NEFT or RTGS?

Ans. Yes. Other banking modes remain permitted. The restriction applies only when UPI is used.

Q7. What is a SEBI-validated UPI ID?

Ans. It is a UPI handle verified by SEBI through exchanges and NPCI, confirming that it belongs to a registered intermediary.

Q8. Can an RIA have multiple validated UPI IDs?

Ans. Yes, subject to SEBI/exchange approval and linkage to registered bank accounts.

Q9. Is this UPI ID linked to SEBI registration?

Ans. Yes. The UPI ID is mapped to the intermediary’s SEBI registration details.

Q10. Will investors see confirmation before payment?

Ans. Yes. The system displays the registered intermediary name when a validated UPI ID is entered.

Q11. Does this apply to subscription-based research models?

Ans. Yes. Any UPI-based subscription payment must use a validated handle.

Q12. Is cash payment allowed after this circular?

Ans. Cash payments are discouraged and may raise audit and AML concerns, though not expressly covered under this circular.

Q13. What happens if an RIA violates this rule?

Ans. SEBI may initiate inspection, impose penalties, or issue directions including suspension.

Q14. Is this applicable to unregistered advisers?

Ans. No. However, unregistered advisers are already prohibited from collecting advisory fees.

Q15. Will this impact existing client agreements?

Ans. Yes. Payment clauses and fee instructions should be updated.

Q16. Is GST impacted by this change?

Ans. No direct change, but validated UPI improves reconciliation and audit trails.

Q17. Can advisory staff collect payments on behalf of the RIA?

Ans. No. Payments must flow directly into the registered intermediary’s account.

Q18. Will SEBI track payments through UPI?

Ans. Yes. The framework enables traceability and enforcement.

Q19. Is this linked with SCORES or grievance handling?

Ans. Indirectly yes, as payment verification becomes easier during disputes.

Q20. Can old UPI IDs be used till September 2025?

Ans. Yes, but intermediaries should migrate well in advance.

Q21. Does this rule apply to foreign clients?

Ans. Yes, if UPI is used for payment collection in India.

Q22. Will exchanges monitor compliance?

Ans. Yes. Stock exchanges act as supervisory and implementation agencies.

Q23. Is this requirement part of RIA annual compliance?

Ans. Yes. It forms part of operational and conduct compliance.

Q24. Can failure impact SEBI renewal?

Ans. Yes. Repeated non-compliance may affect renewal or continuation.

Q25. How can RIAs ensure smooth implementation?

Ans. By applying early, updating documents, and informing clients proactively.