How to become sebi registered investment advisor
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SEBI registered investment advisors are professionals authorized by the market regulator SEBI to help and guide investors to meet their financial goals. The importance of investment advisors is high when the country is growing and the need for financial advisors is in high demand. In that scenario, many are interested in becoming SEBI registered investment advisors. However, it is important to understand how to become a SEBI registered investment advisor.
Table of Contents
SEBI regulates an Investment Advisor
Investment advisors help and guide investors to invest in a particular asset. An investor needs to trust the investment advisor as he is investing his hard-earned money with advice from an unknown advisor.
Hence market regulator SEBI plays an important role in regulating investment advisors. All SEBI registered investment advisors will have to meet certain stringent guidelines from SEBI to be fit to advise investors.
A SEBI registered investment advisor is a financial professional who must meet SEBI’s stringent qualification and experience requirements to be an advisor. If an investment advisor has the SEBI registration number, this signifies a commitment to ethical practices and adherence to a code of conduct.
Hence, while choosing an investment advisor you must check if he/she is SEBI-registered advisor. Working with a SEBI registered investment advisor will give you peace of mind knowing you’re with the right person someone qualified and held to high standards.
How to become SEBI registered investment advisor
In India, SEBI regulated the registration process of investment advisors (RIAs) under the regulation act of SEBI (Investment Advisers) Regulations, 2013. As per the SEBI guideline, an investment advisor is someone who helps, guides, and advises about investment in securities and provides research analysis about the asset to invest in.
How to become investment advisor in India eligibility
A SEBI Registered Investment Advisor should meet the minimum qualification and experience requirements. He/she must have gone through a certification examination
How to become investment advisor important criteria
- Minimum age of 21 years.
- Minimum five years of relevant experience.
- He/she should not have any prior convictions for any economic offense or violation of securities laws.
- He/ she must have a net worth of a minimum of Rs. 1 lakh for individual advisors and Rs. 25 lakhs for non-individuals or institutions.
- He/ she should not be a stockbroker or sub-broker, depository participant, or associated with any one of them.
- As per the qualification of the individual, he or she must have a graduate degree in finance, economics, or business administration or a professional qualification such as a CA, CFA, or MBA.
- They must also pass a certification examination conducted by NISM (National Institute of Securities Markets) or any other SEBI-recognized organization.
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Steps on how to become Investment Advisor SEBI.
- First, you must have a relevant degree and work experience in related fields as mentioned above.
- Get the certification from NISM with the NISM-Series-X-B: Investment Adviser (Level 1) certification exam.
- For SEBI registration get Form A filled out and submit it along with the necessary documents, including identification, qualifications, experience, CIBIL Score, net worth certificate, income tax returns, and an application fee.
- The application fee is around Rs. 5,000 as the application fee may vary from time to time.
- After you submit all the above documents with a fee, SEBI will review the application and may seek additional information as per the requirement.
- Once SEBI verifies your application and approves it, you will be issued a registration certificate and a registration number.
- Once you get the SEBI registration number for an investment advisor, you can start offering advisory services.
- However, it is important to comply with SEBI regulations while providing investment advice.
How to Become Investment Advisor in India
While filling the application form A, the applicant must mention the following in the covering letter:
- Whether the applicant is providing investment advisory services prior to these Regulations. If yes, provide details.
- Details of the investment advice provided prior to such application.
- It is applying for registration of as a new Investment Adviser providing investment advisory services.
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Final step on how to become investment advisor
Get certificate of registration
- Once SEBI satisfied that the applicant complies with the requirements, SEBI approves the application and inform the applicant. On receipt of the payment of registration fees, SEBI grants certificate of registration subject to such terms and conditions as the Board may deem fit and appropriate.
- On receipt of approval from SEBI, the applicant must pay registration fee of Rs.1,00,000/- (If applicant is corporate) and Rs.10,000/- (If applicant is Individual) by way of bank draft in favour of “The Securities and Exchange Board of India”, payable at Mumbai.
- On receipt of registration/ re-registration fees, SEBI will grant the applicant the certificate of registration as an SEBI registered IA.
Final outlook
The process of how to become SEBI registered investment advisor is one thing but getting it done and maintaining your credibility in public life is another thing.
SEBI registered investment advisors must adhere to specific SEBI guidelines while providing advice to clients. This includes identifying and addressing potential conflicts of interest and ensuring the clients know about them. The advisor also needs to do research on various investment options before sharing with clients to mitigate any risk that might be.
Apart from the above, the advisor has to face tough competition from banks, financial institutions such as brokerage firms, and online investment platforms that are also offering similar services.
How do I know if a broker is SEBI registered?
Usually, the broker mentions the SEBI registration number (ID) on their official websites. If in case the advisor does not have a website, you can check their registration number on the SEBI website or with “SEBI registered investment advisor at mind2markets.
What is the qualification for SEBI RIA?
He/ she must have the minimum qualification of a postgraduate degree or postgraduate diploma in finance, accountancy, business management, commerce, economics, capital market, banking, insurance, or actuarial science.
How to become investment advisor and get registered?
Under SEBI (Investment Advisers) Regulations, 2013, submit the filled Form A as provided in the Regulations along with all the necessary supporting documents. SEBI will review the document and grant the registration number if the documents are approved. SEBI may ask for further documents if it is not satisfied with your application.
Who regulates an Investment Advisor in India?
Market regulator The Securities and Exchange Board of India, SEBI regulates an Investment Advisor. That is the reason they are called SEBI-registered investment advisors.
What are the financial requirements to apply for a certificate to be a SEBI Registered Investment Advisor?
The applicant has to deposit around Rs 5000 as an application fee along with other documents and FORM A to get registered.
Where to apply for registering as a SEBI Registered Investment Advisor?
You can apply online FORM with sebi.gov.in and submit the documents. You may also visit the regional SEBI office to submit your documents.
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