The Securities and Exchange Board of India (Sebi) has taken a decisive step to future-proof the country's financial markets. On Thursday, 8 January, the regulator announced the formation of a high-level working group tasked with creating a comprehensive technology roadmap for Market Infrastructure Institutions (MIIs). This blueprint will outline strategies for both the short-term (five years) and the long-term (ten years).
Why Sebi is Focusing on a Tech Roadmap Now
In an official circular, Sebi explained the rationale behind this move. The decision stems from the rapid evolution of technology and its growing significance in every facet of market operations. This includes critical areas like trade execution, market surveillance, risk management, investor protection, and regulatory oversight. The working group will adopt a holistic and forward-looking approach to ensure the Indian securities market remains resilient and globally competitive.
Members and Mandate of the New Working Group
The committee will be led by Professor D B Phatak, Professor Emeritus at IIT Bombay. Its members will include chairpersons from the Standing Committee on Technology (SCOT) of various MIIs, senior officials from stock broking firms, registrars and transfer agents (RTAs), along with independent technology and capital market experts.
The group's primary mandate is to evaluate and recommend the adoption of next-generation technologies. Key areas of focus will include:
- Artificial Intelligence (AI) and Machine Learning (ML)
- Distributed Ledger Technology (Blockchain)
- Cloud Computing
- SupTech (Supervisory Technology) and RegTech (Regulatory Technology) solutions
- Tokenisation of assets
- Quantum-safe cryptographic systems
Sebi stated that this initiative is aligned with India's long-term vision of building a digitally empowered and developed economy. The goal is to keep the market infrastructure future-ready.
What are Market Infrastructure Institutions (MIIs)?
For clarity, Sebi defines Market Infrastructure Institutions as the essential pillars that support the trading ecosystem. According to the regulator, MIIs consist of stock exchanges, clearing corporations, and depositories. These entities form the backbone of the securities market, ensuring smooth trading, settlement, and safekeeping of securities.
This announcement follows Sebi Chairman Tuhin Kanta Pandey's statement in December, where he indicated plans to form such a group. As reported by PTI, Pandey emphasized that the group would benchmark international best practices and develop new approaches to strengthen market infrastructure through cutting-edge technology.
The technological frontier for markets involves applying advanced tools to enhance regulatory oversight, improve operational efficiency, and fortify investor protection mechanisms. This strategic move by Sebi underscores its commitment to steering India's capital markets into a new era of innovation and security.
