SEBI spends below 5 per cent of IPEF corpus on education, awareness of investors: Report

The annual accounts of the capital markets regulator SEBI (Securities and Exchange Board of India) for the past 10 years reveal that the utilisation of the Investor Protection and Education Fund (IPEF) hit a record low of ₹2.8 crore in fiscal 24, reported BusinessLine.

Meanwhile, expenses from IPEF stood at ₹11.9 crore in FY23, ₹6.8 crore in FY22, and ₹28.8 crore in FY21.

The expenses as a percentage of the fund have remained in the range of 0.5-5 per cent in the past five years, claimed the report further.

(Source: BusinessLine)

Ironically, the balance in IPEF, has been growing over the years. Between fiscal 23 to fiscal 24, it more than doubled in value and touched ₹533 crore as of March 2024.

For those who are unaware of the IPEF fund is supposed be used for seminars, awareness programmes, aiding investors’ associations, and for salaries of the Ombudsman, among others. The additions to the fund come from incomes from investments and other receipts, including grants and contributions etc from the SEBI Board.

Awareness programmes

SEBI’s FY24 annual report shows that it conducted 43,826 awareness programmes across India, which include regional investors seminars, workshops, and others.

IPEF is supposed to carry out better monitoring of its fund and expenditure, believe stock market investors and market trackers, reported BusinessLine.

Besides IPEF, the stock exchanges and depositories also have similar funds meant for education and awareness which have a total balance of ₹2,793 crore and ₹127 crore, respectively, as of March 2024.

“More than the amount spent on investor education, we need to see if the spends have the desired impact,” says Shyam Shekhar, investor and founder, ithought Advisory.

It is worth recalling that SEBI implemented an online payment mechanism for IPEF starting September last year.

It was aimed to streamline the payment process and improve accessibility for all contributors to the fund. Following this move, intermediaries could make payments to IPEF conveniently via net banking, NEFT/RTGS, debit cards and UPI.