SEBI Circular on “Adoption of Standardised, Validated and Exclusive UPI IDs for Payment Collection by SEBI Registered Intermediaries from Investors” dated June 11, 2025

For millions of investors, UPI has become the fastest, most convenient way to invest in mutual funds. No net-banking passwords, no waiting for OTPs, just a quick scan, confirm, and you are done. But as the system scaled, so did the risk of sending money to the wrong account. Recognising this, SEBI has introduced a new layer of safety: the ‘@valid’ UPI handle framework.

The growing popularity of UPI in mutual funds

UPI has completely changed how people invest. Over the past few years, fund houses have increasingly integrated UPI into their apps and portals, enabling investors to start SIPs, make lump-sum purchases, or top-up funds instantly.

By August 2025, India processed over 20 billion[i] UPI transactions. A growing share of these came from investors using payment apps to route money directly into mutual funds. The reasons are obvious once you think about them: it works anytime, 24x7, the transfers go through instantly, and there is nothing extra to pay. Most people also like how easily they can check their SIP payments within the same app.

The convenience, however, opened a small crack. Some fraudulent entities began using misleading UPI IDs that appeared genuine often resembling the official ones used by legitimate fund houses. This caused confusion and, in some cases, even financial loss.

This is where SEBI’s new “@valid” initiative comes in.

What is the “@valid” UPI handle?

Starting 1 October 2025, every SEBI-registered intermediary like mutual funds, brokers, portfolio managers, and distributors, must collect money only through a validated UPI handle ending with @valid.

It’ll look something like abc.mf@validaxis or xyz.mf@validaxis.

Here is what makes it different:

The difference lies in authentication:

• Each handle is issued only after SEBI registration is confirmed by both the bank and the NPCI.

• It carries a clear segment tag like .mf for mutual funds, .brk for brokers, .pms for portfolio managers.

  

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• Your UPI app will show a green thumbs-up inside a green triangle when you pay, which is a visible marker that the handle has been verified.

• Fund houses will also display a QR code featuring the same green triangle, so you can check before scanning.

These “validated” handles will be allocated exclusively by the National Payments Corporation of India (NPCI) and linked to intermediaries registered with SEBI. Essentially, if the handle ends with @valid, it’s traceable, regulated, and linked to an officially approved entity.

Why this move by SEBI matters to investors?

This update is less about formality and more about confidence as it directly improves transaction security and peace of mind.

• Eliminates impersonation: Fake handles cannot be created under the new structure.

• Adds traceability: Each @valid ID is mapped to a verified intermediary.

• Improves grievance handling: Refunds and reconciliations become simpler.

• Boosts confidence: Especially among new investors and investors from tier 2-3 cities who were earlier unsure about digital payments.

• No extra steps required: The same UPI app works; you only need to spot the green icon

Before You Invest Again

Here’s what to keep in mind:

• The handle must include .mf and end with @valid <bank> to be backed by NPCI.

   

  

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• Look for the green icon before approving the payment.

• Do your due diligence with UPI IDs sent through WhatsApp or social media.

• Cross-check with the fund house’s official site.

• If you’re starting a new SIP after 1 October, use the updated handle; older ones will continue only temporarily.

   

  

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What this means for the mutual fund industry

The introduction of validated UPI IDs strengthens India’s digital investment infrastructure. It is a significant step towards making digital investing more transparent and secure. As India’s mutual fund participation deepens through online channels, this initiative ensures that investors’ money reaches the right place, every single time. It allows fund houses to maintain investor trust even as payment volumes surge. For investors, it reinforces that security and convenience can coexist. You still enjoy the instant, paperless, real-time experience that UPI offers, only now with a SEBI-approved stamp of safety.

In closing

The next time you open your mutual fund app to make a payment through UPI, remember a few basic steps like pausing for a second to glance at the @valid handle and the green thumbs-up. Because now, your mutual fund UPI investments are truly safer than ever.