India’s Growing Securities Market Needs More SEBI Registered Investment Advisers (RIAs): Investing wisely is crucial for financial growth and security. However, navigating the complex world of stocks, mutual funds, bonds, and other investment avenues can be challenging. Investment Advisors (IAs) help investors make informed decisions by providing expert financial advice tailored to individual goals and risk tolerance. This article will provide a comprehensive understanding of investment advisors, the services they offer, grievance redressal mechanisms, benefits of engaging an advisor, and regulations protecting investors.

Who is an Investment Advisor: An Investment Advisor (IA) is a SEBI-registered professional who provides personalized financial guidance to clients based on their financial goals, risk appetite, and market conditions. Unlike Mutual Fund Distributors (MFDs), who earn commissions from mutual fund sales, Investment Advisors charge fees directly from clients and provide unbiased recommendations.

Why India Needs More Investment Advisors (IAs): In recent years, the Indian securities market has experienced significant growth, leading to an increase in domestic investors. However, the number of investment advisors (IAs) has not kept pace with this growth. The ratio of investment advisors per million people in India is low compared to countries like the USA. This discrepancy has resulted in a rise in unregistered entities showcasing themselves as investment advisors. To address this issue and improve investor access to qualified advice, there is a need to significantly increase the number of registered investment advisors.

India urgently needs more qualified SEBI Registered IAs who can guide retail investors with ethical, personalized, and well-informed financial advice. This presents a tremendous opportunity for finance professionals to build a rewarding career while contributing to the growth of India’s capital markets. However, despite this surge in participation, there are currently only 932 SEBI-registered IAs serving more than 18 crore demat account holders. This indicates a significant gap between the demand for investment advice and the availability of qualified professionals.

1. Who is a SEBI Registered Investment Adviser (RIA)?
A SEBI Registered Investment Adviser is an individual or entity authorized by the Securities and Exchange Board of India to provide fee-based investment advice to clients while complying with SEBI regulations and investor protection guidelines.

2. Educational Qualifications Required
As per SEBI regulations, the applicant must possess any of the following degrees:

• A professional qualification or graduate degree or postgraduate degree or post-graduate diploma (minimum two years in duration) in finance, accountancy, business management, commerce, economics, capital market, banking, insurance or actuarial science
• OR a professional qualification by completing a Post Graduate Program in the Securities Market (Investment Advisory) from NISM of a duration not less than one year
• OR a professional qualification by obtaining a CFA Charter from the CFA Institute

3. Experience and Certifications
Experience: No experience required.
Mandatory Certifications:

• NISM Series-X-A: Investment Adviser (Level 1)
• NISM Series-X-B: Investment Adviser (Level 2)

NISM Study Material

4. Documents and Fees Required

• Proof of identity (PAN/Aadhaar)
• Proof of address
• Educational qualification certificates (including NISM certifications)
• CIBIL Score
• Various other declarations and undertaking
• Non-refundable Application Fee of Rs. 2,000 for individual and partnership firms; and Rs. 10,000 for Companies including LLPs
• Registration Fee of Rs. 13,000 for individual and partnership firms (For a period of 5 years); and Rs. 5,15,000 for Companies including LLPs (For a period of 5 years)

5. How to Apply for RIA Registration
Step-by-step Guide:

1. Visit the BSE India website which facilitates IA registration.
2. Register as a new member.
3. Verify your mobile number and email ID to receive login credentials.
4. Log in using the credentials.
5. Fill out all required details across 12 tabs, including:
   • Applicant details
   • Address details
   • Other details
   • Personal details
   • Associate companies Registration details
   • Other
   • Infrastructure details
   • Other information
   • Change in control
   • Questions
   • Bank details
   • Declaration

Watch the Webinar on Registration Process for Investment Advisers by SEBI and BSE: Registration process guidance

Important Links
• NISM Login Portal
• NISM Study Material
• IA application Documents Checklist
• BSE IA Registration Page

NISM Certification Helpdesk
• Phone: +91-8080806476
• Timing: Monday to Friday, 9:30 AM – 5:30 PM (Closed on public holidays)
• Email: certification@nism.ac.in
• For registration process important contact from SEBI & BSE – Refer BSE India website

For more information, please refer to the following:
• FAQs on SEBI website for IA Registration
• BSE SOP for Registration

Author: N.U. RAJU, DGM, SEBI