Sebi rule may end zero fee period: Zerodha


MUMBAI: Sebi‘s transfer to require stockbrokers to cost prospects solely the precise charges paid to exchanges, clearing homes, and depositories has had main penalties for stockbroking companies.
In its round, Sebi had requested brokers to be ‘true to the label’ in how they levy prices. Zerodha Broking stated it may be compelled to end its zero brokerage construction, and shares of listed stockbroking companies crashed.Angel One – the most important listed dealer – fell 8.7% whereas IIFL Securities fell 3.5%.

The impression of the brand new laws had been defined in an in depth observe by Zerodha founder Nithin Kamath. “Stock exchanges charge transaction fees based on the overall turnover contributed by brokers. The more the turnover, the less the transaction fee. The difference between what the brokers charge the customer and what the exchange charges the broker at the end of the month is a rebate, which goes to brokers. Such rebates are common across major markets in the world,” Kamath stated.
He added that this rebate accounts for 10% of Zerodha’s revenues and wherever between 10-50% of revenues for brokers throughout the trade. This revenue stream will go away following Sebi’s new round. “We were one of the last remaining brokers that offered free equity delivery trades. We could do this because F&O trading revenues were subsidising equity delivery investors. With the new circular, we will likely have to let go of the zero brokerage structure and/or increase brokerage for F&O trades,” stated Kamath.

Nilesh Desai
Nilesh Desai
The Hindu Patrika is founded in 2016 by Mr. Nilesh Desai. This website is providing news and information mainly related to Hinduism. We appreciate if you send News, information or suggestion.


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