SEBI to mandate fingerprint and eye-scan authentication for stock trading via mobile apps
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With an aim to enhance cybersecurity, markets regulator SEBI is looking to put in place a new set of guidelines, wherein fingerprint or eye-scan will be required for stock trading through mobile applications.
The markets watchdog has sought comments from the market participants like brokers, traders, and stock exchanges in this regard, and a final regulation will be put in place after taking into account views of all the stakeholders, regulatory sources said.
In case of applications installed on smartphones and tablets, traders and retail investors may need biometric authentication to buy and sell stocks, according to SEBI’s proposal.
Further, it has been proposed that after few failed log-in bids, investors account might be locked till fresh authentication is completed. For fresh authentication, an e-mail or one-time password may be sent to investors.
According to market experts, small brokers, who operate on low margins, may face difficulties in implementing the proposed guidelines.
The development comes against the backdrop of instances of cyberattacks on systems in different parts of the world including India.
The Securities and Exchange Board of India (SEBI) is of the view that sophisticated cybersecurity and cyber-resilience measures are required for the capital market.
The markets watchdog has been taking several steps to safeguard markets from cyberattacks. This included forming a high-level panel on cybersecurity in May 2017 to suggest measures to ring-fence capital markets from such attacks.
Also, SEBI is beefing up its IT team with experts from cybersecurity arena to ensure stronger firewalls against such attacks and faster corrective measures.