Stock 24 Newsbreak: Discount Brokers Will No Longer Offer Free Services as Sebi Orders Uniform Charges

In a major step, market infrastructure institutions (MIIs), such as stock exchanges, have been instructed by the Securities and Exchange Board of India (Sebi) to provide a consistent pricing structure for all participants. With this ruling, bargain brokers like Zerodha, Groww, Angel One, and Upstox will no longer be able to provide their services for free.

Free Services as Sebi Orders Uniform Charges

Important Points:

• Uniform fees: Regardless of a client’s trading volume or activity level, Sebi has mandated that stock exchanges, depositories, and clearing organizations charge all of their clients uniform fees.
• Accurate to Label Entries: Client fees must accurately represent the money that MIIs actually receive. This guarantees the application of charges in a fair and transparent manner.
  
• Date of Implementation: On October 1, the new pricing structure will take effect.

Affect on Brokers of Discount, ”Free Services as Sebi Orders Uniform Charges”

Discount brokers, who are renowned for providing only trading facilities and no other services, such as research reports, would no longer be able to take advantage of volume-based pricing. According to a stock 24 news article, this modification signifies a move in the direction of a more uniform fee structure throughout the market.

Steps for Implementation:

1. restructure Charge Structure: In order to adhere to Sebi’s principles, MIIs need to restructure their current charge structures.
2. Infrastructure modifications: To put the new regulations into effect, the required infrastructure and system modifications must be finished.
3. Communication: MIIs must notify their members and post the updated charge structures on their websites. Additionally, they have to inform Sebi of the implementation status.

Context and Justification: –

• Market Equity: Sebi seeks to improve equity and transparency in the market. Brokers used to be able to charge customers at higher slabs while paying exchanges reduced rates whenever they reached a certain turnover threshold.
• Savings for Brokers: The largest volume churners, discount brokers, made huge savings by charging customers more than exchanges would charge. The goal of this new directive is to do away with these disparities.

Result:
By lowering fees for end users, improving transparency, and standardizing fees for all brokers, Sebi’s new rules guarantee a level playing field. Await more updates when these modifications become effective.

Read more post…

Account opning link:

1. Groww Account- https://app.groww.in/v3cO/kyrp1zph
2. Kotak neo Account https://kotaksecurities.ref-r.com/c/i/32531/109103906