SEBI Extends Deadline for Retail Algo Trading Framework

Circular No. SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/108; Dated: 29.07.2025

SEBI Proposes Framework for Retail Participation in Algorithmic Trading

The Securities and Exchange Board of India (SEBI) had earlier issued a circular dated February 4, 2025, proposing a regulatory framework aimed at enabling safer and more structured participation of retail investors in Algorithmic Trading through registered brokers. This initiative was introduced to ensure transparency, investor protection, and accountability in the rapidly growing segment of algorithm-based trading.

Original Implementation Date Set for August 1, 2025

As per the initial circular, the framework was scheduled to come into force from August 1, 2025. SEBI’s intention was to create a secure trading environment for retail participants who rely on brokers to access algorithmic trading strategies, thereby promoting broader market participation.

Timeline Extended for Smooth Transition

To facilitate a seamless transition and avoid any operational disruptions for brokers, market participants, and investors, SEBI has decided to extend the timeline for implementation. The extension comes as a response to stakeholder feedback and the need to ensure that necessary technological and procedural adjustments are in place.

New Effective Date: October 1, 2025

Accordingly, the new effective date for the implementation of the circular is now set as October 1, 2025. This extended window will provide market intermediaries with adequate time to align their systems and processes with the new requirements, ensuring a smooth and efficient rollout of the retail algorithmic trading framework.

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