India's Sebi Allows Digital Power of Attorney to Speed Up Foreign Investor Onboarding
India's securities regulator has introduced digitally signed power of attorney documents for foreign portfolio investors, a move designed to slash onboarding delays caused by legacy authentication requirements.
The Securities and Exchange Board of India (Sebi) has authorized the use of digitally signed power of attorney documents for foreign portfolio investors. This regulatory change takes effect immediately and removes the mandatory requirement for physical document authentication.
The primary objective of this shift is to significantly reduce the time required to onboard foreign portfolio investors. Previously, the process required physical authentication steps that created administrative friction for international market participants.
Market authorities acknowledged that these legacy requirements caused notable delays for incoming capital. "During interactions with foreign investors, it has been highlighted that notarisation and apostillisation takes considerable time," Sebi said.
The new framework directly addresses this bottleneck by removing specific bureaucratic hurdles. "Digitally signed PoA is envisaged to bring down the time taken in onboarding considerably as it eliminates the need for notarisation, apostillisation or consularisation of PoA," Sebi said.
Streamlining Market Access
This policy adjustment is part of a wider effort by the regulator to modernize the financial system. Sebi is actively seeking to leverage technology across the capital markets to further streamline regulatory processes.
By reducing compliance hurdles and relying more extensively on technology-driven processes, the watchdog aims to improve market infrastructure. The regulator stated that greater use of such digital processes would help bring down the overall time required for foreign portfolio investor onboarding.
The latitude offered by this new rule is expected to significantly reduce the time taken to onboard foreign portfolio investors. Removing the necessity for physical consularisation and apostillisation eliminates a major administrative barrier to market entry.
The immediate implementation of this rule signals a decisive step in easing the onboarding framework for foreign portfolio investors. It reflects a broader regulatory commitment to reducing compliance hurdles through technology-driven processes.
