Brokers can submit info on client funds on monthly basis

Markets regulator Sebi today asked stock brokers to submit information about their clients' funds to exchanges on monthly basis till next March.
Brokers are currently required to provide information on weekly basis.
Besides, the regulator has made it voluntary for stock brokers to use the nomenclature of the header, 'Stock Broker - Proprietary Account', for proprietary bank as well as demat accounts, Securities and Exchange Board of India (Sebi) said in a circular.
Also, Sebi said that a broker which is also a bank, would be required to report to the exchanges only those accounts that are used for their stock broking activities.

According to Sebi, a broker is entitled to have a lien on client's securities to the extent of the client's indebtedness to the stock broker and the stock broker may pledge those securities.
Pledging of such securities is permitted, in case if, the same is done through depository system in compliance with Sebi norms.

However, Sebi said that brokers would have to ensure they "shall not grant further exposure to the clients when debit balances arise out of client's failure to pay the required amount and such debit balances continues beyond the fifth trading day, as reckoned from date of pay-in". This clause would be effective from August 1.

The brokers would have to submit "aggregate of fund balances available in all client bank accounts, including the settlement account, maintained by it across exchanges" and value of collateral deposited with clearing corporations to bourses on monthly basis instead of weekly basis till March 31, 2018.
"Till March 31, 2018, stock broker shall submit the data as on the last trading day of every month to the stock exchanges on or before the next trading day. Thereafter, the uploading of that data by the stock broker to the stock exchanges shall be on weekly basis," Sebi said.