The probe is likely to be conducted by sleuths of various intelligence wings of Home and Finance Ministries as the allegations, if proved true, would have serious security implications, highly placed sources said.
However, the sources said, it has nothing to do with activist Arvind Kejriwal's allegations of money laundering against HSBC Bank.
The multinational bank had, however, yesterday denied the charges and said it takes compliance with the law very seriously.
The probe agencies will look into reports that funds were being routed from Pakistan and a few Gulf countries to terror groups operating in India using banking networks.
Meanwhile, Home Minister Sushilkumar Shinde today said the government has information that the terror groups operating in India and outside India were investing money in stock markets through various methods.
"We have information that they have been putting in money in stock exchanges and stock markets. We have received information in international fora. We are keeping a track of them. They are investing in stock exchanges in India and some neighbouring countries," he told a press conference.