The role of a market regulator is very important as it fosters trust between consumers and companies, SEBI Chairperson Madhabi Puri Buch said on Thursday.
Speaking at the Global Fintech Fest in Mumbai on Thursday, SEBI Chairperson said that compliance not only benefits consumers but businesses too.
“The role of regulation and the regulator is to really give protection to the consumer or to the investor in case of markets. Equally, on the business side, regulation and compliance are important because they foster trust in the system,” said Buch.
The SEBI Chairperson highlighed the pivotal role that fintech plays in enhancing the ease of doing business.
Asked on how regulators give approvals to an innovator who approaches it, Buch stated that if the innovation is in any way helping the consumers, the regulators always react positively and grant the approval.
“The principle that we as a regulator follow is actually very simple: if you are doing something which is enhancing the well-being of the consumer, nine out of 10 times the regulator will say yes. They may put some compliances of reporting to monitor, but nine times they will say yes,” said SEBI Chairperson.
Buch also noted that if there is a lack of concern by the innovator about what is actually happening to the investors’ money, in those cases, with reasonable probability, one can assume that nine times out of 10, the regulator will say no.
SEBI is also working on marking a standardized format for all the platforms, including the BSE, NSE, or MCX, in terms of file formats to reduce the integration cost of companies into the market. The SEBI Chairperson highlighted that doing this will reduce the cost and time for the innovators or the players in the market.
“We are working very hard to make sure that standardization happens in the market ecosystem to encourage low-cost innovation in terms of fintech. Whether you are talking to CDSL or NSDL, it should be the same API structure so your cost of innovation comes down,” added Buch.
On making the regulatory framework easy and reducing time in the stock market, Buch also highlighted that SEBI is now using Artificial Intelligence to speed up the process. She said, “Half of our AI products will speed up our process and half of them our supervision process.”
She also added that in the latest F&O’s recent consultation paper by SEBI, opinions of about 6,000 people were received.
“We are able to do this in a better way only because of the technology of processing a large number of feedbacks. The aim is to make compliance easier with the help of technology,” Buch said.
