Investor Charter
The Investor Charter is a SEBI-mandated document that every registered intermediary must display on its website and at client-facing locations, detailing the rights, obligations, do's and don'ts, and grievance redressal mechanisms available to investors dealing with that intermediary.
SEBI introduced the Investor Charter requirement through circulars issued in 2021, as part of a broader investor protection initiative aimed at ensuring that investors are aware of their fundamental rights and the obligations of intermediaries at the time of engaging with them. The Charter is a standardised document tailored for each category of intermediary.
SEBI prescribed separate Investor Charters for stockbrokers, depository participants, mutual fund distributors, portfolio managers, investment advisers, research analysts, Alternative Investment Funds, REITs, InvITs, and other registered entities. Each charter follows a standard structure: a vision statement on investor protection, a list of services provided, investor rights, investor obligations, dos and don'ts, and the grievance redressal matrix with timelines.
For stockbrokers, the Charter specifies rights such as the right to receive contract notes, the right to receive funds and securities within prescribed timelines, and the right to lodge complaints with SEBI SCORES. It also outlines investor responsibilities such as providing correct KYC information, not sharing login credentials, and understanding the risks before trading in derivatives.
Compliance with the Investor Charter mandate is monitored through SEBI inspections and through the annual compliance reports that intermediaries file. SEBI has directed stock exchanges to ensure that listed companies and their intermediaries maintain updated charters on their websites.
The Investor Charter is also linked to the onboarding process: intermediaries were directed to share the Charter with new clients at the time of account opening and obtain an acknowledgement. This ensures that investors cannot later claim ignorance of basic rights and processes.
The Charter initiative complements SEBI's investor education programmes conducted through the Investor Education and Protection Fund (IEPF) and the National Institute of Securities Markets (NISM).