The Daily PulseBusiness
SEBI to issue AI guidelines for capital markets soon
Reported by Ishita Mukherjee (Staff Writer) · Livemint - Markets ·
Confirmed by a second source: The Hindu - Business
Photo: Wikimedia CommonsNew AI Rules
The Securities and Exchange Board of India will soon release detailed rules for using Artificial Intelligence in capital markets to balance new technology with investor safety. Chairman Tuhin Kanta Pandey stated that these guidelines will cover mandatory disclosures, company accountability, and human-in-the-loop controls for key decisions.
Cyber Risks
Speaking at the 45th India International Trade Fair 2026, Pandey noted rising cyberattacks on crypto platforms and financial firms, alongside digital frauds by social media influencers. The regulator launched an incident response framework in May aligned with the Financial Stability Board's FIRE template. SEBI is also checking cryptographic systems to prepare for future quantum computing risks expected to peak between 2032 and 2035.
Startup Platform
SEBI has built supervisory tools like the Sudarshan platform and is reviewing the Innovators Growth Platform to attract more startups. The working group will focus on deep-tech and biotech firms that take longer to make profits.
Context
SEBI acts as the main watchdog for the securities market in India to protect investors and keep financial systems safe. Regulators worldwide are racing to set new rules as automated trading and digital tools grow rapidly.
ExplainerWhy this matters
What Happened
SEBI is preparing new rules for Artificial Intelligence and upgrading its cybersecurity systems to handle emerging tech risks in the stock market.
Why It Matters
As automated trading and AI tools become common in finance, lack of proper rules can lead to sudden market crashes or major investor fraud. Human oversight and strict data security protect everyday investors from losing money to hidden algorithmic flaws or cyberattacks.
What Happens Next
SEBI will officially release the detailed AI guidelines and review feedback from its earlier consultation papers to enforce compliance across all market participants.
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