Summary
- SEBI is actively developing a regulatory framework for AI-generated investment advice, emphasizing that registered human professionals remain accountable for any misleading or inaccurate recommendations.
- Starting January 2025, firms must disclose the extent of AI usage in their research processes, reinforcing that AI does not diminish regulatory responsibility.
- The regulator's June 2025 Consultation Paper outlines principles like accountability and transparency, indicating a shift towards stricter compliance expectations for fintech platforms and advisory firms.
- As SEBI enhances its enforcement capabilities using AI tools, firms must prepare for increased scrutiny and ensure robust governance structures around their AI systems.
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