In a major initiative to encourage investors from the rural and semi urban areas to participate in the equity market, the National Stock Exchange (NSE) today announced reduction of connectivity charges and waiver of transaction charges.
The move to reduce charges will make it more cost- effective for common investors, especially located in the semi-urban and rural areas, NSE said in a statement here. Currently, members taking leased-line connectivity from the rural and semi-urban areas to connect to the Exchange have to pay an amount of Rs 1 lakh, annually, on a recurring basis.
Post today's announcement, the exchange has decided to waive the transaction charges pertaining to the trades generated from these leased lines to the extent of the annual leased line connectivity cost of Rs 1 lakh, it said.
This move is mainly to facilitate trading members to establish trading terminals in these semi-urban and rural areas as at a reasonable cost. It is expected that there are around 300 leased lines in these areas which are used by members and they will benefit from this.
Also, it is expected to benefit a large number of investors in these regions. The incentive will be applicable to all the trading volumes generated through these leased lines with effect from April 1, 2010, NSE said.
In its continuing endeavour to encourage investors from semi-urban and rural areas and to facilitate members to set up infrastructure in those regions at a reasonable cost, NSE has brought down the infrastructure costs for members.
The immediate benefit of this initiative will be availed by NSE members who are connected to the POPS (points of presence) at Rajkot, Jaipur and Kochi. Against the existing connectivity charges of Rs 2 lakh to Rs 2.50 lakh per leased line in these regions, the exchange has revised the charges to Rs 1-lakh per annum.
"These announcements are in tune with our thrust to make high quality infrastructure affordable beyond the metros and to encourage market access from these centres," NSE's Joint MD, Chitra Ramakrishna said.