The Securities and Exchange Board of India (SEBI) is set to introduce a dedicated digital platform aimed at streamlining the registration and compliance process for investment advisors. The initiative is intended to reduce regulatory complexity and encourage broader participation in India’s advisory ecosystem.
SEBI SETU: A Unified Support Platform
The proposed platform, named SEBI SETU, is expected to be launched within the current month. It is designed as an end-to-end digital system that will assist investment advisors throughout their lifecycle—from initial registration to ongoing compliance requirements.
The platform will offer structured regulatory guidance, acting as a support framework similar to tools previously developed for foreign portfolio investors. By simplifying processes and providing clarity, SEBI aims to make the advisory profession more accessible and efficient.
Addressing the Advisor Gap
India has witnessed rapid growth in retail participation, with over 22 crore demat accounts. However, the number of registered investment advisors remains relatively low—fewer than 1,000, with an even smaller number actively practicing.
A major barrier has been the complex and time-intensive compliance framework, which has discouraged professionals from entering the space. The SETU platform is expected to bridge this gap by offering step-by-step assistance and reducing procedural friction.
Regulatory Reforms Supporting the Initiative
The launch of SETU follows a series of regulatory changes introduced to ease entry and operations for advisors:
- Advisors can now provide second opinions on financial products
- Fee structures based on assets under advice (AUA) are permitted, capped at 2.5% annually
- Mandatory disclosure of dual charges and annual client consent requirements
- Individual advisors crossing thresholds can continue onboarding clients during transition to a corporate structure
- Eligibility criteria simplified, allowing any graduate with relevant certification from the National Institute of Securities Markets (NISM) to register
Additionally, documentation requirements have been relaxed. Applicants are no longer required to submit documents such as CIBIL reports, net worth statements, or infrastructure details, although self-declarations will still be necessary.
Enhancing Ease of Doing Business
The introduction of SEBI SETU reflects the regulator’s broader objective of improving ease of doing business within the financial advisory sector. By reducing entry barriers and simplifying compliance, SEBI aims to expand the pool of qualified advisors and strengthen investor access to professional financial guidance.
Summary
SEBI is set to launch the SETU platform to simplify registration and compliance for investment advisors. The initiative aims to reduce regulatory complexity, increase advisor participation, and bridge the gap between a growing investor base and the limited number of registered advisors. Recent regulatory relaxations further support ease of entry and operational flexibility in the advisory ecosystem.
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