NSE Proposes Stricter Rules for Authorised Persons: Higher Net Worth and Deposit Requirements
NSE Proposes Tighter Framework for Authorised Persons
NSE has proposed a comprehensive overhaul of the rules governing Authorised Persons (APs), who work with stock brokers to facilitate trading services. The proposed framework, developed jointly by the stock exchanges in consultation with SEBI, is intended to strengthen investor protection, improve oversight and enhance accountability within the broking ecosystem.
The proposed norms include stricter eligibility and financial requirements for APs, increased use of technology for monitoring their activities and greater responsibility on stock brokers to ensure compliance and supervise AP operations.
Higher Eligibility and Financial Requirements
Under the proposed framework, individuals seeking to become Authorised Persons would need to meet stricter eligibility conditions, including educational qualifications, work experience and mandatory NISM certification.
- Individual APs: Proposed minimum net worth of RS.5 lakh.
- Partnership Firms, LLPs and Body Corporates: Proposed minimum net worth of RS.25 lakh.
- Deposit Requirement: Every AP would be required to maintain a minimum deposit of RS.1 lakh with the stock broker.
What to Watch Next
The proposed rules are still subject to consultation and feedback before they are finalised. Market participants will now watch for the final framework and any changes made following industry comments.
If implemented, the revised norms could significantly increase compliance requirements for both Authorised Persons and stock brokers.
Disclaimer
Investments in the securities market are subject to market risks. Read all related documents carefully before investing. Registration granted by SEBI, and certification from NISM in no way guarantee the performance of the intermediary or provide any assurance of returns to investors. Choice Equity Broking Private Limited: SEBI Reg No. Broking - INZ000160131 ( BSE - 3299 ) | ( NSE - 13773 ) | ( MSEI - 73200 ) | ( MCX - 40585 ) | ( NCDEX - 01006 ). Depository Participant SEBI Reg. No. - IN - DP - 84 - 2015, DP ID CDSL - 12066900, NSDL ID - IN301895. Research Analyst - INH000000222 (CIN. NO.: U65999MH2010PTC198714)
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