The Securities and Exchange Board of India (Sebi) is actively integrating artificial intelligence into its regulatory framework to enhance oversight and ensure market integrity. The markets regulator is deploying AI-driven tools to analyse compliance with its rules and is developing a specialized tool to assess the cybersecurity readiness of the entities it oversees.
AI-Powered Surveillance and Future Tools
Chairman Tuhin Kanta Pandey made these significant announcements while speaking at an event organized by the Bombay Stock Exchange (BSE) to mark the 40th anniversary of the Sensex. He detailed the regulator's technological advancements, which include the Sebi Sudarshan system. This tool is designed for the surveillance of unauthorised digital activity and for conducting sentiment analysis on corporate announcements.
Furthermore, Pandey confirmed that an AI-driven inspection tool is currently under development. This new system aims to strengthen the risk-based supervision of regulated entities, allowing for more efficient and targeted oversight.
Cybersecurity in Focus
In a critical move to bolster India's financial market infrastructure, Sebi is in the process of creating a dedicated tool to test the cybersecurity preparedness of its regulated entities. This initiative underscores the growing importance of digital security in an increasingly interconnected financial ecosystem and aims to proactively identify and mitigate potential cyber threats.
Sebi on BSE's Historic Legacy
Reflecting on the occasion, Chairman Pandey emphasized the deep interconnection between the Indian securities market and the history of the BSE, one of Asia's oldest stock exchanges. He noted the remarkable resilience of the institution, stating, "Very few institutions anywhere in the world have witnessed and endured global crises such as the World Wars, the Great Depression of 1929, Oil shock, the Dot-com bubble-burst, the global financial crisis, and more recently the pandemic."
The integration of advanced AI tools like Sebi Sudarshan and the forthcoming cybersecurity testing instrument represents a forward-looking approach by the regulator. It signals a shift towards more proactive, data-driven governance designed to protect investors and maintain stable, transparent markets in the face of evolving technological challenges and global uncertainties.
