NISM-Series-X-A: Investment Adviser (Level 1) · Grievance Redress Mechanism

SEBI Online Dispute Resolution (ODR) Mechanism Explained

Updated 11 October 2026 · Fact-checked

SEBI's ODR mechanism is an online route to settle disputes between investors and SEBI-regulated intermediaries. You first complain to the intermediary, then on SCORES. If still unhappy, you go to the ODR portal, where an institution tries conciliation first and then arbitration if conciliation fails.

Understand Online Dispute Resolution (ODR) Mechanism

Investors often have disputes with brokers, advisers, mutual funds and other regulated entities. Courts are slow and costly. SEBI therefore set up a Common Online Dispute Resolution (ODR) portal. It lets a dispute be handled fully online, without visiting an office.

The ODR route is a later step, not the first. The usual order is: (1) complain directly to the intermediary; (2) if unresolved or you are unhappy, lodge the complaint on SCORES, SEBI's complaint platform; (3) if you remain dissatisfied or the complaint is still unresolved, you can start dispute resolution on the ODR portal. You can invoke ODR only after the intermediary and SCORES routes have been exhausted and you remain dissatisfied. You start the process yourself on the portal, and you must do so within the time limit the framework prescribes. ODR does not replace SCORES. SCORES is a complaint-redress platform. ODR is a formal dispute-resolution process run by approved ODR institutions.

Inside ODR there are two stages. Conciliation comes first. A neutral conciliator helps both sides reach a voluntary settlement. Nobody is forced to agree. If conciliation is not successful, the matter goes to arbitration. An arbitrator hears both sides and gives a decision, called an award. Arbitration runs under the Arbitration and Conciliation Act, 1996. The award is binding, subject to the appellate arbitration provision in the ODR framework (a second arbitration panel) and to challenge under Section 34 of the Arbitration and Conciliation Act, 1996.

Think of it as a ladder: talk, complain, settle with help, then get a decision. Each rung has a time limit, so the process does not drag on. For an Investment Adviser, this means you must know the ladder, tell clients about it, and respond promptly when a dispute reaches ODR.

Key formulas to remember

Escalation order: Intermediary → SCORES → ODR (conciliation → arbitration if conciliation is not successful); ODR can be invoked after the intermediary and SCORES routes if the investor remains dissatisfied. Do not pick ODR as the first step in an exam question.
Conciliation timeline: Time limit prescribed by SEBI's ODR circular, with a possible extension; The exact number of days, any extension and the start point are set in the current SEBI Master Circular for ODR. Confirm them in the latest circular before your test.
Arbitration timeline: Time limit prescribed by SEBI's ODR circular, with a possible extension; Arbitration has its own limit, separate from conciliation. Confirm the current days, extension and start point in the latest circular. Do not apply one stage's limit to the other.
Nature of outcomes: Conciliation = voluntary settlement; Arbitration = binding award; Conciliation needs both parties to agree. Arbitration gives a decision, binding subject to appellate arbitration and challenge under Section 34 of the Arbitration and Conciliation Act, 1996.

How to solve Online Dispute Resolution (ODR) Mechanism questions

Use this method for any question on SEBI's ODR mechanism.

1Identify what is asked: the order of steps, the stage, a timeline, or the nature of the outcome.
2Find where the investor stands: has the intermediary been approached, and has SCORES been used?
3If the intermediary or SCORES step is missing, the answer is usually to complete that step before ODR.
4If the dispute is in ODR, check whether conciliation has been tried. Conciliation comes before arbitration, and arbitration follows when conciliation is not successful.
5For timeline questions, match the stage: conciliation and arbitration each have their own time limit, prescribed by SEBI's ODR circular. Use the figures in your current study material and the latest circular.
6For outcome questions, remember conciliation is a voluntary settlement and arbitration is a binding award, subject to appeal and Section 34 challenge.
7Eliminate options that make ODR the first step, reverse the stages, or say SCORES and ODR are the same.

Quickest way: Ladder and clock shortcut

When to use it: Use when you have under a minute per question and the options list steps or days.

Write the ladder: Firm, SCORES, ODR, then Conciliation, then Arbitration.
Pick the option that respects this order.
For days, pair each stage with its own limit from SEBI's ODR circular, as given in your current study material. Check the latest circular for the exact figures.
Reject any option that says arbitration comes before conciliation or that ODR skips SCORES.

Common mistakes in Online Dispute Resolution (ODR) Mechanism

Treating ODR as the first step for any complaint.
The word 'dispute resolution' sounds like the main route.
Fix: Remember ODR is the later stage. First the intermediary, then SCORES, then ODR.
Saying SCORES and ODR are the same platform.
Both are SEBI online systems for investors.
Fix: SCORES is for lodging and tracking complaints. ODR is for formal conciliation and arbitration through ODR institutions.
Putting arbitration before conciliation.
Arbitration feels like the stronger, more familiar step.
Fix: Conciliation is tried first. Arbitration follows when conciliation is not successful.
Mixing up the timelines of the two stages.
Both have a base period plus a possible extension, so the numbers blur.
Fix: Conciliation and arbitration each have their own time limit under SEBI's ODR circular. Learn them as separate pairs from the latest circular and do not swap them.
Thinking a conciliation outcome is binding even if a party disagrees.
Confusing conciliation with arbitration.
Fix: Conciliation produces a settlement only if both sides agree. The binding decision comes from the arbitration award.

Worked examples

Example 1

An investor has a dispute with a SEBI-registered investment adviser. The adviser's reply did not satisfy the investor, and the investor lodged a complaint on SCORES, which also did not resolve it. What is the next step available under SEBI's framework, and what is tried first there?
A) File a fresh complaint with the adviser only
B) Initiate dispute resolution on the ODR portal, starting with conciliation
C) Go directly to arbitration on the ODR portal, skipping conciliation
D) Close the matter, as no further route exists

Show the solution

The investor has already completed the first two rungs: the intermediary and SCORES.
The next rung is the ODR portal.
Within ODR, conciliation is tried first and arbitration follows only if conciliation fails.
Option A repeats a step already done. Option C skips conciliation. Option D is wrong because ODR exists.

Answer: B

Example 2

A dispute is in the ODR process. Which statement is correct?
A) Conciliation is binding on both parties even without their agreement
B) Arbitration must be completed before conciliation starts
C) Conciliation aims at a voluntary settlement, and if it fails the matter can go to arbitration, which gives a binding award
D) SCORES and the ODR portal are the same platform

Show the solution

Conciliation is a facilitated negotiation. It leads to a settlement only if both sides agree, so A is wrong.
The order is conciliation then arbitration, so B is wrong.
SCORES is a complaint-redress platform, while ODR is a formal process run by ODR institutions. They are not the same, so D is wrong.
C states the order and the nature of both outcomes correctly.

Answer: C

Exam tips

Questions can test the order of escalation. Fix the ladder in your mind: firm, SCORES, ODR.
Conciliation and arbitration each have their own time limit under SEBI's ODR circular. Learn the current figures from the latest circular and keep the two stages separate.
Watch for options that call SCORES and ODR identical. They are separate mechanisms.
On NISM X-A, a wrong answer costs 25% of the question's marks: 0.25 for a 1-mark question and 0.5 for a 2-mark question. With four options, a blind guess has a small positive expected value, and eliminating even one option improves it. Attempt questions where you can eliminate at least one option.

Practice questions from Grievance Redress Mechanism

Online Dispute Resolution (ODR) Mechanism in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

CA FinalDispute Resolution Mechanisms and Settlement

Online Dispute Resolution (ODR) Mechanism: frequently asked questions

What is the difference between SCORES and SEBI ODR?

SCORES is the platform where you lodge and track a complaint against a regulated entity. ODR is a later, formal route where an ODR institution runs conciliation and then arbitration. You normally use SCORES before ODR.

How does SEBI ODR work with conciliation and arbitration?

You can invoke ODR only after the intermediary and SCORES routes are exhausted and you remain dissatisfied. A conciliator first helps the parties settle voluntarily. If conciliation is not successful, the matter goes to arbitration, where an arbitrator gives an award. The award is binding, subject to the appellate arbitration provision and challenge under Section 34 of the Arbitration and Conciliation Act, 1996.

What are the ODR timelines I should remember?

SEBI's ODR circular prescribes a time limit for conciliation and a separate one for arbitration, each with a possible extension. The exact days and the point from which they are counted can change when SEBI amends its circulars. Check the current SEBI Master Circular for ODR before your exam.

Is conciliation under ODR binding?

No. Conciliation ends in a settlement only if both parties agree. A binding decision comes from the arbitration award.