Sebi Introduces Simpler NISM Exam For Sales And Support Staff At Investment Advisors

The Securities and Exchange Board of India (Sebi) has eased certification requirements for certain employees at registered investment advisers, allowing sales staff and other non-advisory personnel to qualify through a separate and less intensive National Institute of Securities Markets (NISM) examination.

The regulator has introduced a different certification track for employees engaged in sales, relationship management and other support functions, while those involved in providing investment advice will continue to follow the existing qualification framework.

The revised norms have come into effect immediately. Sebi said the decision was taken after receiving feedback from market participants and as part of its efforts to improve ease of doing business.

New Certification Route For Non-Advisory Staff

Under the existing framework, Persons Associated with Investment Advice (PAIA) were required to clear two examinations — NISM Series-X-A: Investment Adviser (Level 1) and NISM Series-X-B: Investment Adviser (Level 2).

However, Sebi said employees engaged only in sales and other non-core activities need not undergo the same certification process as advisers.

“Based on the feedback from market participants and as a step towards ease of doing business, it has been decided to specify a lighter NISM certification module for PAIA, such as sales staff, relationship managers and other staff, who only perform sales and other non-core services,” Sebi said in its circular.

The regulator added that these employees may interact with clients but are “not directly associated or involved in investment advice related aspects.”

Such employees will now have to clear the NISM Series-XXV-B: Persons Associated with Investment Advice (Sales and Other Non-Core Services) Certification Examination.

Advisory Staff Must Continue Existing Certification

Sebi has clarified that the relaxation applies only to employees engaged in sales and support functions. Employees involved in investment advisory activities will continue to be required to pass both the Level 1 and Level 2 investment adviser examinations.

According to the circular, “PAIA, other than those who perform sales and other non-core services, shall continue to obtain certification” through the existing NISM Series-X-A and NISM Series-X-B examinations.

Relief For Existing Employees

Sebi has also provided transitional relief for employees who have already obtained the Level 1 and Level 2 certifications.

Employees covered under the new category who already hold the higher-level certifications will not be required to immediately appear for the new examination.

Instead, they can continue with their existing certifications and obtain the NISM Series-XXV-B qualification only before the validity of their current certifications expires.

The regulator has also directed the Investment Adviser Administration and Supervisory Body (IAASB) to amend its rules and disseminate the revised requirements among registered investment advisers.