Share sale money will be deposited directly in the customers' account, risk will be reduced by SEBI's new rules
SEBI issued a notification, the new rule will come into effect from October 14. Currently, customers' money is deposited in the broker's pool account. Under the current rules, the clearing corporation deposits money in the broker's pool account after the share sale. If any disparity arises in the accounts of the customer and the broker, then TM or CM can compensate for it through auction.
Muskan
Follow Us
Market regulator SEBI has made it mandatory to deposit the share sale money directly into the customers' account. SEBI has taken this step with the aim of operational efficiency and reducing the risk to customers' money.
According to the notification issued by the market regulator on Wednesday, these new rules will come into effect from October 14, 2024.
After the share sale, the clearing corporation deposits funds into the broker's pool account, according to current rules. Following this, the broker transfers the funds to the customers' demat accounts. SEBI said in a statement that after extensive consultations with stock exchanges, clearing corporations (CC), and depositories, it was decided to deposit share sale proceeds directly into customers' demat accounts.
SEBI states that clearing corporations will provide a mechanism for trading members (TM) and clearing members (CM) to distinguish between shares not paid under the margin trading facility and those paid under the margin trading facility.
SEBI has suggested that if any disparity arises in the accounts of the client and the broker, then the TM or CM can compensate it through auction. In such cases, the broker will not be able to charge any fee. In May 2023, SEBI introduced several procedures regarding the payment of money for the shares of the clients. Their aim was to protect the shares of the customers.
