Introduction to the Sebi Survey
The Securities and Exchange Board of India (Sebi) conducted a comprehensive survey to understand the reasons behind Indian investors’ aversion to the stock market. The survey, which covered 90,000 households across 400 cities and 1,000 villages, revealed some startling insights into the mindset of Indian investors.
Lack of Awareness: A Major Concern
The survey found that a significant number of investors are unaware of the official channels for grievance redressal, with only 6% of respondents aware of the Sebi Complaint Redress System (SCORES). This lack of awareness is further compounded by the fact that 64% of non-investors and 43% of current investors would approach the police or general courts for financial grievances, rather than the market regulator.
Disconnect in Education
The survey also highlighted a glaring mismatch between investors’ learning preferences and the methods employed for financial education. While 70% of respondents prefer receiving educational content via social media and 60% through mobile apps, less than 1% of those surveyed have attended a formal Investor Education Programme. This underscores the need for digital-first education and personalized advisory services.
Investor Exodus: Reasons and Consequences
The survey found that poor performance is the primary driver for investors to exit the market, with 84% of lapsers citing this reason. The consequences of this educational gap are significant, with many investors remaining vulnerable and ignorant about their rights. The survey also reveals the powerful influence of social circles, with negative experiences shared by friends or family contributing to 32% of lapsed investors.
A Hazy Path to Justice
The survey exposes a profound lack of awareness among investors regarding Sebi’s official grievance redressal mechanism. The overall awareness of the SCORES platform is critically low, and even among active investors, it remains at only 20%. This confusion has serious consequences, weakening investor protection and creating risks to market integrity.
Effective Route: Bridging the Gap
While the SCORES system is highly effective for those who use it, with 88% of aware investors reporting satisfaction with the resolution process, its potential is being squandered due to a massive communication failure. To bridge this gap, practical, design-led reforms like digital accessibility through multilingual, mobile-friendly design are suggested.
Conclusion
The Sebi survey highlights the need for effective investor education and awareness campaigns to bridge the gap between investors’ learning preferences and the methods employed for financial education. By addressing these concerns and providing personalized advisory services, the Indian stock market can become more inclusive and attractive to investors.
