Description

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Picture Courtesy: INDIAN EXPRESS

Context:

The Securities and Exchange Board of India (SEBI to launch verified UPI handles and 'SEBI Check' verification tool by October 2025 to strengthen investor protection.

How the New Verified UPI Mechanism Works?

The core problem SEBI aims to solve is the "lack of verification," which allows fraudsters to mimic legitimate entities and siphon off investors' money. The new system introduces a clear, verifiable, and exclusive payment channel.

A Standardized and Exclusive UPI Handle

All SEBI-registered intermediaries who collect funds from investors will be required to obtain a special, verified UPI handle.

This handle will have a unique and exclusive identifier: "@valid", which will be allocated only by the National Payments Corporation of India (NPCI) to SEBI-registered entities.

The UPI ID will follow a clear structure: intermediary_name.category_suffix@validBANK.

For example, a stock broker named 'ABC' with an account in 'XYZ' bank would have a UPI ID like: abc.brk@validXYZ.
A mutual fund would have a suffix like .mf.

Visual Confirmation for Investors

To make identification easy, a clear visual cue—a "thumbs-up inside a green triangle" icon—will be displayed on the payment screen when an investor makes a payment to a verified handle.

The 'SEBI Check' Verification Tool

It will allow investors to independently verify the authenticity of any intermediary before making a payment.

How it Works => Investors can either scan a QR code or manually enter a UPI ID into the tool.

The tool will confirm the legitimacy of the UPI ID and display associated bank details, including the account number and IFSC code, cross-referencing them with SEBI's official database.

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Source:

INDIAN EXPRESS

PRACTICE QUESTION

Q. Which of the following statements about the Unified Payments Interface (UPI) framework is incorrect?

A) UPI is built upon the existing Immediate Payment Service (IMPS) infrastructure, enabling real-time inter-bank transfers.

B) UPI mandates a two-factor authentication process for every transaction, typically involving device binding and a user-set UPI PIN.

C) A user can link multiple bank accounts from different banks to a single UPI application.

D) Once a UPI transaction is successfully initiated and the payer's account is debited, the payment can be stopped or reversed by the payer through their app.

Answer: D

Explanation:

UPI transactions are designed to be instant and irrevocable, just like handing over cash. Once you enter your UPI PIN and authorize the payment, the funds are immediately debited from your account and sent for credit to the receiver. The system does not provide a feature to stop or reverse a successful transaction from the payer's end. If you have sent money to the wrong person, you cannot simply "cancel" it.