'Scammers impersonating brokers': What Zerodha's Nithin Kamath says on SEBI's new UPI security feature 

Market regulator SEBI's new UPI security feature could help reduce fraud incidents significantly, Zerodha's Nithin Kamath said on Monday.

In a post on X, Kamath highlighted the increasing number of fraud cases involving scammers posing as brokers and requesting payments to random accounts. “The number of fraud cases involving scammers impersonating brokers and asking for money to be transferred to random accounts has skyrocketed,” he said.

To counter this, SEBI introduced a system where all legitimate fund transfers must be made only to verified UPI handles in the format: brokername@validbank. Kamath said Zerodha plans to implement this feature soon.

Called SEBI Check, the tool allows users to verify the authenticity of UPI IDs used in securities transactions. Scheduled to go live on October 1, 2025, the system will enable investors to authenticate UPI handles of SEBI-registered intermediaries before transferring funds, ensuring payments are directed only to verified entities.

This verification mechanism will be mandatory for all SEBI-registered entities involved in fundraising activities.

SEBI Chairman Tuhin Kanta Pandey last week emphasised the importance of the tool in enhancing investor confidence. “We are introducing a system within the UPI framework to verify whether a UPI ID belongs to a registered entity like a bank, broker, or other authorized intermediaries. This will be very useful,” he said during the official announcement.

The move comes in response to growing concerns about cyber fraud, especially as UPI-based payments become increasingly popular among retail investors.

“There’s a lot of public concern regarding cyber fraud,” Pandey added. “With over 130 million unique investors, we need a system that ensures their investments go to the right place.”