New Delhi, Sept. 11 -- A new mandate from the Securities and Exchange Board of India (Sebi) that requires banks to maintain two separate digital databases for sensitive information has forced them to navigate a maze of high costs, technological hurdles and legal conflicts.

Sebi's dual structured digital database (SDD) rule requires India's listed banks to maintain two distinct, tamper-proof digital logs of unpublished price-sensitive information (UPSI). One database must track the bank's own UPSI, while the second must log confidential data held on behalf of its clients, such as companies it advises or lends to.

While the market regulator's goal is to curb insider trading, the industry is warning of a disproportionate compliance burden ...