GENERAL17 Sept 2026
Brokers push back against Sebi's proposed net worth rule | Stock Market News
Sebi wants to change how brokers' variable net worth is calculated. Currently it is 10% of the average daily cash balance they hold for clients. The plan uses 10% of clients' average credit balance over six months, plus extra capital based on active client numbers. Brokers object, since client funds now go to clearing corporations daily, yet capital would be set aside for money they no longer hold.
Key Statutory Highlights
- Sebi's April 2026 consultation paper proposes that variable net worth be based on 10% of clients' average credit balance over the previous six months, instead of the cash balance retained by the broker.
- Brokers argue that since 2023 nearly all client funds are upstreamed to clearing corporations by the end of each trading day, so the new basis would force them to set aside capital against money already moved out of their hands.
- The proposal adds a client-count based component, such as an extra ₹50 lakh of net worth for brokers with more than 10,000 and up to 50,000 direct active clients.
Actionable Advice for Taxpayers / Founders:If you run or deal with a broking business, review your current net worth position against the proposed credit-balance and active-client formula, and consider sharing your feedback with Sebi or your industry body before the rules are finalised. Confirm the final position with your CA, since the proposal is not yet law.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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