Subject: GS 3: Economy
Context: Recently, the Securities and Exchange Board of India (SEBI) has introduced the IT Resilience Index (ITRI).
About ITRI
- The IT Resilience Index (ITRI) is a quantitative resilience barometer introduced by the Securities and Exchange Board of India (SEBI) to assess the robustness of critical IT systems of Market Infrastructure Institutions (MIIs).
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About Market Infrastructure Institutions (MIIs)
- MIIs are institutions that provide the essential infrastructure required for the functioning of securities markets.
- They include stock exchanges, clearing corporations and depositories.
- They perform critical functions such as trading, clearing, settlement and securities holding.
- Due to their systemic importance, disruption in their operations can affect the wider financial market.
Reasons For SEBI Introducing ITRI
- Rising Technological Dependence: Indian capital markets increasingly depend on technology, with even a few minutes of disruption potentially affecting millions of investors and billions of rupees in trades.
- Protection of Critical Functions: ITRI assesses whether systems supporting trading, clearing, settlement and securities holding can withstand disruptions.
- Growing Digitalisation: Increased retail participation through online platforms, algorithmic trading and faster settlement cycles has made market efficiency inseparable from technology reliability.
- Systemic Importance of MIIs: In 2015, SEBI classified MIIs as “systemically important” and called for a robust cybersecurity framework for their systemically critical functions.
- Shift from Compliance to Resilience: It moves regulatory assessment from merely checking compliance towards quantitative risk monitoring.
How will ITRI Work?
- Assessment Approach: ITRI will move from mere compliance checking to quantitative measurement of IT resilience and technology risk.
- Nine Parameters: It will assess IT resilience through nine parameters, with weights based on their systemic-risk importance.
- Key Weights: Availability and Security carry 20% each, Business Continuity and Reliability 10%, and Scalability 5%.
- Measurement: The Industry Standards Forum of MIIs will define the detailed sub-parameters and measurement criteria.
- Periodic Refinement: The weights may be refined using actual outage data, cyber incidents and stress tests.
- Early Warning System: MIIs will develop an Early Warning System (EWS) to detect deterioration in resilience parameters and enable timely remedial action.
How is ITRI Different?
- Measurable Resilience: ITRI converts IT resilience into a measurable index, unlike the predominantly principle-based global approach.
- Financial Stability: MII-level technology failures can pose a financial stability risk, not merely an IT risk.
- Early Detection: The Early Warning System (EWS) identifies weaknesses before they become failures.
- Future Readiness: SEBI’s technology roadmap addresses risks from AI, cloud, high-frequency trading, DLT and quantum technologies, along with SupTech, RegTech and tokenisation.
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ITRI: Comparison with Global Standards
- United Kingdom: The Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) require institutions to identify important business services, set disruption tolerances and demonstrate recovery capacity.
- European Union: The Digital Operational Resilience Act (DORA) provides a comprehensive regulatory framework for digital resilience, rather than a numerical scorecard.
- United States: Technology resilience is incorporated into broader regulatory oversight, without a single ITRI for stock exchanges.
- Singapore: The Monetary Authority of Singapore (MAS) follows strong technology-risk management guidelines.
- Hong Kong: Regulators use cyber-resilience assessment frameworks and measurable maturity levels.
- Australia: The Australian Securities and Investments Commission (ASIC) and Australian Prudential Regulation Authority (APRA) focus on critical operations, technology dependencies, outsourcing risks and cyber recovery.
27 Aug 2026
