Sebi Imposes Deadlines for Financial Advisers to Validate Historical Performance Data

In a significant development for the Indian securities market, the Securities and Exchange Board of India (Sebi) has officially operationalised the Past Risk and Return Verification Agency (PaRRVA) framework. Announced on April 29, 2026, this initiative is designed to standardise the reporting and verification of investment performance metrics across the market, providing a clearer and more reliable landscape for investors. The first agency to be recognised under this new framework is Care Ratings, with the National Stock Exchange (NSE) serving as the PaRRVA Data Centre, marking a crucial step towards enhancing transparency in investment communications.

As the PaRRVA platform is set to launch on May 4, 2026, all investment advisers (IAs) and research analysts (RAs) are required to enroll by August 3, 2026, to continue sharing certified past performance metrics with their clients. Post-2028, it will be mandatory for only PaRRVA-verified data to be communicated, effectively phasing out historical performance data from the pre-PaRRVA period. This change is poised to significantly impact how clients access and interpret investment information, enforcing stricter compliance and accuracy in performance reporting.

This regulatory shift aims to mitigate misleading claims often found in investment performance reports, thereby fostering investor confidence. For Indian investors, the introduction of PaRRVA represents a vital step toward safer and more informed investing. The standardisation of risk and return metrics will not only empower investors with consistent data but also help them make better-informed decisions while navigating the complex securities market landscape.

Source: Business Standard