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New Delhi, Dec 5 (PTI) To facilitate ease of doing business, markets regulator Sebi on Thursday proposed that funds of clients, who have not done any transaction in the last 30 days, will be settled by stock brokers on the upcoming settlement dates of monthly running account settlement cycle.
Under the rule, if a client has not done any transaction in the last 30 days and has a credit balance, the stock broker is required to return the fund to the client within three working days. This is known as running account settlement or quarterly settlement.
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With a view to facilitate ease of doing business as well as to safeguard the investors' interest, Sebi, in its consultation paper, proposed revising the requirement of mandatory settlement of such clients' funds.
"It is being proposed that the funds of such clients who have not traded in the last 30 calendar days shall be settled on the upcoming settlement dates of monthly running account settlement cycle as notified by exchanges in the annual calendar issued by them from time to time," Sebi said.
The proposal came after Brokers' Industry Standards Forum (ISF) represented that the current requirement necessitates TM to identify such clients daily, potentially leading to the daily settlement of client funds and resulting in procedural inefficiencies.
Also, it has further been represented that since the client funds are anyway upstreamed to the clearing corporation, there is a need to revisit the time for settling such client's funds.
The Securities and Exchange Board of India (Sebi) has sought public comments on the proposal till December 26.
(This is an unedited and auto-generated story from Syndicated News feed, LatestLY Staff may not have modified or edited the content body)
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