Financial awareness, and not tax incentives, is required to bring in more investors into the capital markets, SEBI Chairman Ajay Tyagi on Sunday said.
“People should be (financially) aware. To take everyone along and to help them understand the potential of the market is a big task,” he said.
Tyagi was speaking at a function organised at the National Institute of Securities Markets (NISM) campus at Patalganga near Navi Mumbai.
“Some people say to get people invest into capital markets, there should be some support in terms of tax. I don’t support this,” he added.
Noting that it is crucial to spread financial literacy across the country, the senior IAS officer said, “India is a huge country and if there is participation only from some areas then something is not correct.”
He said people across the country should invest in the capital markets, and not just those from Mumbai and Ahmedabad.
Pointing to a SEBI survey where investors thought derivatives are a safer instrument than bonds, the SEBI chief said the finding was disturbing.
“The capital market are booming but if only some people participate in them, then it is unfair and wrong,” said Tyagi, who took over as the SEBI chairman last month.
The function was organised to felicitate the winners of National Financial literacy Assessment Tests (NFlAT).
NFlAT is conducted across the country for school students. So far, nearly five lakh students have taken the NFlAT since its inception and close to 4,000 schools have participated in the tests.