SEBI’s Quantum Security Mandate: What Every Regulated Entity Needs to Know and Do

Why Quantum Is on SEBI’s Radar

The Securities and Exchange Board of India (SEBI) has officially recognized quantum computing as a looming cybersecurity threat. Its Cybersecurity and Cyber Resilience Framework (CSCRF v1.0 Aug. 2024) makes it mandatory for Regulated Entities (REs) to prepare for post-quantum risks. SEBI also issued FAQs on Cybersecurity and Cyber Resilience Framework (CSCRF) for SEBI REs and Framework for Adoption of Cloud Services by SEBI REs in June 2025.

The reason? Quantum computers can break widely used cryptographic systems, exposing sensitive financial systems and consumer data. Even though quantum computers are not yet mainstream, attackers can harvest encrypted data today and decrypt it later when quantum capability matures — a threat commonly referred to as “Harvest Now, Decrypt Later”.

This is no longer a theoretical risk — SEBI is asking organizations to act now.

Key Requirements for Regulated Entities (REs) Under CSCRF

SEBI’s CSCRF outlines specific, actionable, and mandatory steps for quantum threat preparedness. These include:

1. Inventory of Cryptographic Assets

• Regulated Entities (REs) shall maintain a comprehensive inventory of all assets using cryptographic mechanisms — including data at rest, data in transit, communication channels, authentication systems.

• It shall include keys, certificates, algorithms and other cryptography artifacts, and describe which application uses what cryptography and for what purpose.

2. Periodic Risk Assessment (including Quantum Risk)

• REs are required to conduct risk assessments that explicitly include quantum-related risks.

• Assess threats, vulnerabilities, likelihood, and business impact — including scenario-based quantum risk testing.

• Perform assessments half-yearly for Market Infrastructure Institution (MIIs) and annually for qualified/mid-sized REs.

3. Prioritization for PQC Migration

• REs must prioritize systems and cryptographic assets for migration based on: Sensitivity of information Exposure to external threats Criticality to business operations.

4. Enable Crypto-Agility and Quantum Safe Strategies

• Develop plans for systems that can and cannot migrate to PQC.

• Prepare for seamless upgrade paths — considering crypto-agile architectures.

5. Awareness, Policy Updates & Proof-of-Concept Trials

• Conduct training and skill upgrades for leadership and technical teams.

• Run pilot projects or proof-of-concepts with PQC tools and technologies.

• Revise cybersecurity policies to incorporate quantum readiness.

6. Future-Proofing

• REs are expected to monitor advancements in quantum computing.

• Explore adoption of technologies PQC and Quantum Key Distribution (QKD) technologies.

• Ensure that senior management and third-party service providers are aware of quantum-related risks.

Overall, these are not optional guidelines. They are mandatory expectations under CSCRF and require planning and execution, starting today.

What Should Regulated Entities Do Now?

Quantum Safe Migration is a complex journey. Meeting SEBI’s CSCRF requirements is a journey — one that starts with small, strategic steps that build momentum toward full compliance. Here's a phased approach REs could adopt:

Your Quantum Compliance Roadmap – 5 Phased Steps

* Step 1: Build Awareness and Leadership Engagement

Ensure Board and executive stakeholders understand the risks and regulatory expectations. SEBI requires the Board/Leadership to approve the list of critical systems and oversee quantum risk management. The stakeholders shall be equipped with relevant skills.

* Step 2: Start with Cryptographic Inventory

Begin identifying cryptographic assets, dependencies, and usage — across the enterprise including on-premise, cloud, and third-party integrations.

* Step 3: Perform Quantum Risk Assessment

Use a structured method to assess and quantify your organization’s exposure to quantum risks and identify critical gaps and prioritize the systems migration based on the risk levels.

* Step 4: Define Your Crypto-Agility Roadmap

Craft a strategy that enables gradual, non-disruptive migration toward PQC and quantum-safe technologies with continuous improvement in crypto agility level of the organization.

* Step 5: Experiment and Monitor

Run pilot projects or proof-of-concepts with PQC tools and technologies and closely monitor the developments in the quantum computing and quantum safe technologies.

SEBI’s inclusion of quantum security in its regulatory framework is a wake-up call for the financial industry. It’s no longer about “if” — but how quickly and smartly your organization responds.

Meeting all these requirements can be overwhelming and needs significant investment and efforts, which can additional burden on the already stretched cyber teams. In addition, many REs face some common challenges like,

• Lack of in-house quantum security expertise

• No clear visibility of cryptographic dependencies

• Uncertainty on how to begin prioritizing PQC migration

• Limited internal resources for assessment and strategy

That’s where AvinyaSQ’s Ignite Starter Packs come in — specially crafted to help REs take their first confident steps without needing deep in-house quantum expertise or massive up-front investment. These are carefully curated solutions bundles designed to help organizations like you to take their first strategic steps toward preparing for the quantum era. These packs provide structured, actionable, and low-barrier entry points for understanding, assessing, and initiating quantum-safe readiness.

Each pack is tailored to different levels of readiness — from initial awareness to pilot implementations — offering clarity and confidence to your leadership and technical teams. With a mix of executive briefings, risk assessments, discovery & inventory pilots, and roadmap development, these packs help converting quantum uncertainty into tangible next steps.

With the AvinyaSQ Ignite Starter Packs, you don’t need to boil the ocean — just light the spark.

You can start small, build clarity, and lay the groundwork for full-scale compliance and resilience. Whether you're a large MII, a mid-sized RE, or just starting your compliance planning, AvinyaSQ Ignite Starter Packs give you a structured, cost-effective way to kickstart your quantum-safe journey.

Ready to Ignite Your Quantum Readiness?

If you’re a SEBI-regulated entity seeking clarity, structure, and speed in meeting CSCRF quantum mandates, AvinyaSQ’s Ignite Starter Packs are your launchpad for the quantum readiness.

Explore Now: https://avinyasq.com/qsm-ignite-starter-packs

Contact us or email at info@avinyasq.com to schedule a no obligation briefing.