Sebi seeks to hike net worth requirement for brokers as defaults spike

Industry players said the latest proposals will put further pressure on the brokers, who have been grappling with several regulatory changes

The Securities and Exchange Board of India (Sebi) has proposed to increase the net worth requirement for stock brokers manifold, amid a spate of defaults by brokers and several instances of misuse of client securities.

Currently, the networth requirement for brokers differs for each segment and functions they reform. For instance, a so-called professional clearing member (PCM) or a trading and clearing member (TM & CM) is required to have networth of Rs 3 crore for the cash segment and another Rs 3 crore for the equity derivatives segment.

Sebi has proposed that the base networth for PCM should be