The pre-conditions only call for the software for calculating margins, administrative set up and overall margining and monitoring systems to be in place.
The lure of higher trading volumes alongside the real threat of the big-daddies amongst stock exchange strengthening their reach would result in smaller regional stock exchanges seeking to join the bandwagon to trade in the modified carryforward system (MCFS).
Thus, the new set of players who will trade in the MCFS may not be limited to the `pre-1993 gang' which includes the Ahmedabad, Delhi, Calcutta and Mumbai stock exchanges. Further, it will now aid in bringing some markets, which indulged in illegal badla, on the legal badla system. The exchanges will now gear up to match the pre-conditions in the modified carryforward system report released officially by the J R Verma committee this week.
The Ahmedabad, Delhi and Calcutta stock exchange representatives have already made presentations before the Verma committee wherein details of the broad framework and approach towards the new MCFS were discussed. Interestingly, a collective group of 69 members of the Association of NSE Members also met Verma and placed their written submission seeking the revival of modified badla at the capital markets.
In an informal chat with Business Standard, Verma said, "The pre-conditions only call for the software for calculating margins, administrative set up and overall margining and monitoring systems to be in place.
The smaller exchanges have already invested in the hardware. I would not be surprised if some regional SEs made a pitch for the MCFS.''
The Ahmedabad Stock Exchange is keen to get onto the MCFS platform but sources said the exchange may take some more time to smoothen out its monitoring and margining system with funding constraints affecting the exchange.
The BSE has already stepped up its action by streamlining its banking data entry module.
The exchange has made it mandatory for all its members to open their accounts with the Bank of India (Stock exchange branch). "We will ensure that there will be one download of the accounts data whether debit or credit for the pay-in and pay-out cycle.
The software programme for calculation of the margins is already in place,'' BSE president M G Damani said.
According to the BSE top brass, electronic fund transfer facility with the bank would be ready within two months.
Verma felt that the smaller exchanges had witnessed the threat of the NSE expansion, and with BSE all set to go national, the exchanges may decide to opt for the new route in their bid to boost trading volumes.
