UPI based fund blocking mechanism for trading in secondary market

In its continuing endeavour to safeguard investors’ assets from misuse/ default by brokers, SEBI introduced a process for trading in secondary markets based on “blocked funds in investors’ bank account” instead of transferring the funds upfront to the broker. The mechanism harnesses public digitalisation infrastructure by integrating RBI approved Unified Payment Interface (UPI) mandate service (single block and multiple debits) with the secondary market trading and settlement process.