SEBI vide circular dated November 11, 2024 has issued clarification regarding trading supported by Blocked Amount in Secondary Market. SEBI Master Circular on Stock Exchanges and Clearing Corporations dated October 16, 2023, introduced a supplementary process for trading in secondary market based on blocked funds in investors bank account, instead of transferring them upfront to the TMs, thereby, providing enhanced protection to the cash collateral of the investors.
Considering the significant changes required to be made in the systems and processes of the Clearing Corporations, Stock Exchanges, Depositories, NPCI and the TMs, in implementation of the facility of trading supported by blocked amount to trade in the secondary market, the following has been decided:
- In addition to the current mode of trading, the Qualified Stock Brokers (QSBs) shall provide either the facility of trading supported by blocked amount in the secondary market (cash segment) using UPI block mechanism or the 3-in-1 Trading Account facility, to their clients.
- The 3-in-1 trading account facility offered/ to be offered by the TMs shall, at least have the features.
- Clients of the QSBs will have the option, to either continue with the existing facility of trading by transferring funds to TMs or opt for either of the facilities, as provided by the QSBs.
