SEBI’s Investor Risk Reduction Access (IRRA Platform): A Solution for Disruption of Trading Services

The Investor Risk Reduction Access (IRRA platform) is a contingency service introduced by the SEBI to address the issue of disruption of trading services provided by Trading Members (TMs).

Key Features and Functions of the Investor Risk Reduction Access (IRRA platform):

  • The IRRA platform is a contingency service developed by the SEBI to provide investors with an avenue to square off/close their open positions and/or cancel pending orders in the event of disruption of trading services provided by a Trading Member (TM).
  • The IRRA platform will be jointly managed by the stock exchanges and will be available across multiple segments and exchanges.
  • TMs can request the enablement of the IRRA service in case of technical glitches, and the stock exchanges will also monitor parameters such as connectivity and order flow to initiate the enablement of the service if needed.
  • Investors will be able to access the IRRA platform through a secure login system using their Unique Client Code (UCC) or PAN number and will be authorized through a One Time Password (OTP).
  • The IRRA platform will also provide TMs with access to an Admin Terminal, through which they can monitor the actions of investors and carry out actions on their instructions.
  • The TM will continue to be responsible for all activities on the IRRA platform, including settlement and margin requirements.
  • In case of reverse migration to the TM’s systems, the IRRA platform will be deactivated, and all pending orders and open positions will be migrated back to the TM’s systems.
SEBI's Investor Risk Reduction Access (IRRA Platform)

Overview of the IRRA Platform

The Investor Risk Reduction Access (IRRA) platform is a contingency service developed by the Securities and Exchange Board of India (SEBI) to address the issue of disruption of trading services provided by Trading Members (TMs). In recent times, with the increasing dependence on technology in the securities market, there have been instances of glitches in TMs’ systems that have led to the disruption of trading services and investor complaints. In such situations, investors with open positions may not have an avenue to close their positions, particularly if markets are volatile.

To address this issue, SEBI has developed the IRRA platform, which will be jointly managed by the stock exchanges. The IRRA platform will provide investors with an opportunity to square off/close their open positions and/or cancel pending orders in the event of disruption of trading services provided by a TM. The IRRA platform will be available across multiple segments and exchanges, and TMs and investors will be able to access it through a secure login system. The IRRA platform will also provide TMs with access to an Admin Terminal, through which they can monitor the actions of investors and carry out actions on their instructions.

The IRRA platform is an important resource for mitigating risk in the event of disruption of trading services and ensuring the continuity of trading for investors. It is designed to provide a backup solution in case the TM’s own business continuity plans are unable to prevent disruption, such as in cases of cyber-attacks or the inability to move to a Disaster Recovery Site (DRS) within the stipulated time. The IRRA platform will be activated upon request by the TM or suo moto by the stock exchanges if needed based on monitoring of parameters such as connectivity, order flow, and social media posts.

Enabling the IRRA Service

Trading Members (TMs) can request the enablement of the Investor Risk Reduction Access (IRRA) service in the event of technical glitches that lead to the disruption of trading services. TMs can make such a request as per the procedures specified by the stock exchanges from time to time. The IRRA service will be enabled on receipt of such a request.

In addition to requests made by TMs, the stock exchanges will also monitor parameters such as connectivity, order flow, and social media posts to suo moto initiate the enablement of the IRRA service if needed. This service will be enabled by the exchanges suo moto only in case of disruption of trading services of the TM across all exchanges where the TM is a member. In cases of disruption of trading services of the TM with one or some of the exchanges where the TM is a member, the TM may request the enablement of the service, in which case the TM will use the service for all exchanges.

It is important to note that the IRRA service will only be activated in cases of disruption of trading services provided by the TM. In the event that the IRRA service is activated, all investors of the TM will be informed by the exchange through email/SMS and a public notice on the exchange’s website. The TM will also be required to communicate the availability of the service by displaying it on their own website.

Accessing the IRRA Platform

Once the Investor Risk Reduction Access (IRRA) service is enabled, investors of the Trading Member (TM) can log in to the service using either their Unique Client Code (UCC) or their PAN number. They will then be authorized to access the IRRA platform through a One Time Password (OTP) that will be sent to their registered mobile numbers and email IDs.

Once successfully authorized, investors will be able to square off/close their open positions and/or cancel pending orders across segments and exchanges. The IRRA platform will not permit any actions that increase the risk of the investor.

In addition to investor access, the IRRA platform will also provide the TM with access to an Admin Terminal. Through this terminal, the TM can monitor the actions of investors and carry out actions on their instructions. The TM will be required to maintain evidence of such instructions in the form specified by SEBI/stock exchanges from time to time. In the event that the IRRA service was enabled due to a cyber-attack, the Admin Terminal will be on a network other than the one subjected to the attack in order to protect other critical infrastructure.

IRRA Platform is not a Replacement for Normal Trading

It is important to note that the IRRA platform is intended to provide a contingency service in the event of disruption of trading services provided by the TM. It is not intended to replace the normal trading systems and processes of the TM, and all open positions and pending orders will be migrated back to the TM’s systems once the IRRA service is deactivated.

TM Responsibility on the IRRA Platform

The Trading Member (TM) remains responsible for all activities on the Investor Risk Reduction Access (IRRA) platform, including settlement and margin requirements. This means that the TM is responsible for ensuring that all obligations related to trades executed through the IRRA platform are met.

Reverse Migration to TM Systems

In the event that the Investor Risk Reduction Access (IRRA) service is deactivated, all pending orders and open positions will be migrated back to the Trading Member’s (TM’s) systems. The stock exchanges will design a detailed plan for the reverse migration of such orders and positions, taking into consideration the various scenarios that may arise.

The reverse migration process will be initiated by the stock exchanges on receipt of a request from the TM, or suo moto in cases where the IRRA service was enabled due to a cyber-attack or other disruptive event that has been resolved. The TM will be required to confirm the receipt of all orders and positions that have been migrated back to their systems.

It is important to note that the reverse migration process is a critical aspect of the IRRA service and must be handled carefully to ensure the continuity of trading and minimize risk to investors. The stock exchanges and the TM will be responsible for ensuring the smooth and timely execution of the reverse migration process.

Conclusion: The Importance of the IRRA Platform

The IRRA platform is an important resource for mitigating risk in the event of disruption of trading services and ensuring the continuity of trading for investors. It is designed to provide a backup solution in case the TM’s own business continuity plans are unable to prevent disruption, such as in cases of cyber-attacks or the inability to move to a Disaster Recovery Site within the stipulated time. The IRRA platform is an essential tool for ensuring the smooth functioning of the securities market and protecting the interests of investors.

Also Read:

  1.          What is the IRRA platform?

           The IRRA platform is a contingency service developed by the Securities and Exchange Board of India (SEBI) to provide investors with an opportunity to square off/close their open positions and/or cancel pending orders in the event of disruption of trading services provided by a Trading Member (TM).

  2.         How is the IRRA platform activated?

            The IRRA platform can be activated upon request by the TM in the event of technical glitches that disrupt trading services, or suo moto by the stock exchanges if needed based on monitoring of parameters such as connectivity, order flow, and social media posts.

  3.         How do investors access the IRRA platform?

            Investors can access the IRRA platform through a secure login system using their Unique Client Code (UCC) or PAN number, and will be authorized through a One Time Password (OTP) sent to their registered mobile numbers and email IDs.

  4.         What actions can investors take on the IRRA platform?

             Once authorized to access the IRRA platform, investors can square off/close their open positions and/or cancel pending orders across segments and exchanges. The IRRA platform will not permit any actions that increase the risk of the investor.
     

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