Sebi units regulation for on-line bond suppliers

The Securities and Exchange Board of India (Sebi) has come out with an in depth regulatory framework for on-line bond platform suppliers in a bid to streamline their operations.

Online Bond Platform Providers (OBPPs) could be corporations included in India and they need to register themselves as inventory brokers within the debt section of the inventory alternate, as per the framework that will be efficient instantly. OBPPs can’t provide services or products on its platform besides listed debt securities and debt securities proposed to be listed by a public providing.

Such an entity needs to be an organization included in India and register itself as a inventory dealer within the debt section of the inventory exchanges. “With the bond market offering tremendous scope for development, particularly in the non-institutional space, there is a need to place checks and balances in the form of transparency in operations and disclosures to the investors dealing with such online bond platforms (OBPs), measures for mitigation of payment,” it stated.

There has been a rise within the variety of OBPPs providing debt securities to non-institutional buyers of late.T right here has additionally been an increase within the variety of registered customers who’ve transacted by such OBPs.

While OBPs present an avenue for buyers, significantly non-institutional buyers to entry the bond market, their operations have been exterior Sebi’s regulatory purview, the regulator famous. After acquiring
registration as a inventory dealer within the debt section of a inventory alternate, an entity must apply to the bourse to behave as an OBPP.

In its software, the entity should be sure that roles and obligations, know-how, working framework — entry and participation, Know Your Client (KYC) for on-boarding buyers and sellers and threat profiling of buyers — are complied with.