The Securities and Exchange Board of India (SEBI) is stepping up its cyber resilience framework for the country’s capital markets as technology and artificial intelligence become increasingly embedded in market infrastructure.
SEBI is examining an IT Resilience Index for Market Infrastructure Institutions (MIIs) to provide an objective framework for assessing the resilience of critical systems, SEBI Chairman Tuhin Kanta Pandey said at FICCI’s 23rd Annual Capital Markets Conference on August 19.
The regulator has also created a Cyber Suraksha Portal to strengthen information sharing and cyber resilience across the market ecosystem.
The move comes as digital KYC, paperless onboarding, mobile platforms and electronic payments have become integral to the investment journey. At the same time, SEBI has flagged cybersecurity, data protection and accountability as key risks associated with greater use of AI in financial markets.
SEBI is also preparing guidelines for the responsible use of AI and machine learning in the markets. The proposed framework will include clear accountability and governance controls, including “Kill Switch” and “Humans in the Loop” mechanisms and data controls.
Importantly, SEBI regulated entities will remain responsible for the privacy, security and integrity of investor data and AI generated outputs even when such systems are developed or procured from third parties.
The push comes as India’s capital markets expand rapidly. The country had around 149 million unique investors, while equity issuances crossed Rs 4.5 trillion in FY2025-26.
With market infrastructure becoming increasingly digital, SEBI’s focus is shifting from simply preventing cyber incidents to ensuring that critical systems remain resilient, recoverable and trusted.
For India’s financial markets, cybersecurity is no longer just an IT issue. It is becoming a core pillar of market stability and investor confidence.
