Indian financial system
In this chapter: Structure, intermediaries, regulators · Investor protection framework
India's financial system has multiple regulators: RBI (banks, NBFCs, currency), SEBI (capital markets, intermediaries), IRDAI (insurance), PFRDA (pensions), MoF/CBDT (taxation). Each regulates its own ecosystem. Investment Advisers, registered with SEBI, give securities-related advice to clients for a fee — distinct from distributors who sell products on commission.
The investor-protection framework spans all regulators: SCORES (SEBI), Bima Bharosa (IRDAI), Banking Ombudsman (RBI), and CPGRAMS (overall government). For securities, the SEBI Investor Education & Protection Fund Authority compensates investors in specific defaulted scenarios. Investor associations like AIBOA and consumer-finance bodies act as advocacy intermediaries. Knowing which regulator handles which complaint is core to advising clients on resolution.
A 2024-25 development: the SEBI-IRDAI-PFRDA convergence on retirement and long-term financial planning. Joint advisories on cross-product mis-selling are increasingly common — for example, ULIPs marketed as mutual funds without disclosure of insurance overhead. RIAs must be conversant with all three regulator regimes when advising on retirement portfolios.