On June 2, 2025, SEBI issued circulars amending the Investor Charter for Investment Advisers (IAs) and Research Analysts (RAs).
The updated Investor Charter introduces key additions to strengthen transparency, accountability, and investor protection.
Key Additions to the Investor Charters:
#1 – Adherence to Advertisement Code – IAs and RAs must ensure all advertisements comply with the respective Advertisement Code as prescribed by SEBI.
#2 – Non-Discrimination in Services – IAs and RAs should not from discriminate among clients opting for similar services, ensuring equitable treatment.
#3 – Usage of AI tools – IAs and RAs are required to disclose the extent of use of Artificial Intelligence (AI) tools in providing services.
#4 – Record keeping for IAs – RAs have to maintain records of interactions, with all clients including prospective clients (prior to onboarding), where any conversation related to the research services has taken place. (IAs already had this provision)
#5 – Terms and conditions for RA services – RA have to provide proper terms and conditions for their research services.
#6 – KYC by RAs – RAs have to complete KYC process for all their fee-paying clients.
#7 – Grievance Redressal Mechanism – SEBI has specified a detailed grievance redressal mechanism for both IAs and RAs to ensure efficient resolution of investor complaints
Compliance Requirements for IAs and RAs
IAs and RAs are required to take the following actions:
#1 – Display on website:
IAs and RAs have to display the Investor Charter on their website and mobile application (if any).
Click here to download the updated Investor Charter for IAs.
Click here to download the updated Investor Charter for RAs.
#2 – Display in office:
IAs and RAs have to display the Investor Charter at a prominent place in their office.
#3 – Provide the Investor Charter to all clients
IA and RAs have to inform all the clients, existing as well as new clients, about the updated Investor Charter.
For the existing clients, the Investor Charter can be shared through e-mails (either sharing a link to the website or as an attachment) or through a physical document.
For the new clients, Investor Charter has to be a part of the on-boarding process. Investor Charter can be shared as an annexure to the client agreement.
Investor Charter need not be on a letterhead.
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The compliance requirements are effective immediately.
SEBI’s modifications aim to enhance financial consumer protection, promote financial inclusion, and improve financial literacy among investors. Will a revised Investor Charter achieve this aim, only time will tell!