Finance Minister Nirmala Sitharaman on Saturday asked the Securities and Exchange Board of India (SEBI) to help drive the adoption of standardised know your customer (KYC) norms and the simplification and digitalisation of its processes across the Indian securities market.
“It is the shared responsibility of all stakeholders to ensure that no citizen has to repeat the same verification journey across multiple financial products and platforms. We must all work collectively towards it with a sense of urgency,” she said while speaking at the Sebi Foundation Day.
Sitharaman said that the market regulator has the scale of investor participation, the depth of digital infrastructure, and the institutional credibility among peer regulators to take the lead in this domain.
“We must also work towards improving our citizens’ experience of financial services. We need a seamless, secure, and portable KYC experience across the financial sector,” Sitharaman said, adding, “This has been discussed with the regulators at the FSDC (Financial Stability and Development Council).”
Deepen the bond market
The finance minister also spoke about deepening the corporate bond market which requires structural reforms across several dimensions simultaneously.
“SEBI must be the convening and coordinating force,” she said.
She said SEBI must continue to drive standardisation in issuance documentation, strengthen frameworks for secondary market liquidity, and work in close coordination with the government and other regulators on mutual issues.
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“At the same time, equal attention must be given to building a more effective credit enhancement architecture, so that access to bond markets is not confined only to the highest-rated issuers, but can gradually extend to a wider set of fundamentally viable enterprises,” Sitharaman said.
“A deeper bond market must also include a serious push for Municipal Bonds. India’s cities are central to growth, but urban infrastructure cannot be financed sustainably through budgetary resources alone,” the FM said.
SEBI may therefore consider working with urban local bodies, state governments and the Ministry of Housing and Urban Affairs to further improve the municipal bond framework, she said.
Get ready to meet cybersecurity challenges
Sitharaman said SEBI must also be ready to meet emerging challenges — and the most pressing of these is cybersecurity.
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“A single successful cyberattack on a major exchange, depository, clearing corporation, or large broker could disrupt markets at national scale, erase wealth, and shake public confidence in ways that take years to rebuild,” she said.
“AI-led tools are making cyberattacks faster, more adaptive, scalable, and in some cases more autonomous in execution. These risks can take many forms — automated discovery of system vulnerabilities, malicious source-code interference, attacks aimed at software supply chains and coordinated intrusions that can evolve in real time to evade detection,” FM said.
Therefore, not just SEBI but all regulated entities will have to remain exceptionally vigilant.
“The tools of attack are evolving at high speed, and the tools of defence must evolve even faster,” she said.
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She said SEBI has done commendably well and good work with the Cybersecurity and Cyber Resilience Framework that came into effect in April 2025.
“This is a solid foundation on which more work can be undertaken. It is praiseworthy that SEBI’s Data Analytics and Digital Forensics Laboratory is using advanced analytics, AI/ML models to detect complex market manipulation patterns and network-based frauds,” she said.
With the increasing use of technology, there is an explosion of fake investment videos and apps circulating on social media, many of them using deepfake AI to impersonate leaders, FM said.
‘We want better markets, not merely bigger markets’
The finance minister also spoke about creating better markets.
“Above all, we want better markets, not merely bigger markets. Size without integrity is fragility. Volume without investor protection is exploitation. Growth without governance is unsustainable. And ensuring that is definitely a shared national priority and responsibility,” she said.
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“With scale comes complexity, and with ambition comes accountability. Indian markets still face a set of structural and emerging challenges that must be confronted with intellectual honesty,” she said.
“I believe it is the mark of a mature regulatory system that it learns from past episodes without being paralysed by them,” she said.
Sitharaman said the invisible infrastructure of markets is trust and integrity.
“So, markets grow on trust. And, trust rests on fairness, transparency, enforcement and predictability. But, trust must be continuously renewed, because new risks are emerging. Investor trust and market integrity are not merely market variables. They are public goods,” she said.
