This move will improve fund management and further enhance investors’ convenience, allowing them to create a payment mandate by blocking funds for trading which will safeguard their amount from misuse.”
FinTech BizNews Service
Mumbai, 1 October, 2024: SEBI has mandated Qualified Stock Brokers (QSBs) to offer UPI-based mechanism for secondary market. The SEBI Board, at the 207th meeting on Monday September 30, 2024, has approved a number of important measures. Taking into account the feedback of various stakeholders and keeping in view the significant potential benefits to investors, the Board has approved that in addition to the current mode of trading, the Qualified Stock Brokers (QSBs) shall provide either the facility of trading supported by blocked amount in the secondary market (cash segment) using UPI block mechanism (ASBA-like facility for the secondary market) or the 3-in-1 Trading Account facility, with effect from February 1, 2025. Clients of the QSBs will have the option, to either continue with the existing facility of trading by transferring funds to Trading Members (TMs) or opt for the facility, as provided by the QSB.
Rahul Jain – CFO, NTT DATA Payment Services India, provides encouraging insights on the development:
“The Securities and Exchange Board of India (SEBI) allowing Qualified Stock Brokers (QSBs) to either provide Unified Payments Interface (UPI) block mechanism, or Application Supported by Blocked Amount (ASBA) like facility for secondary market, or 3-in-1 trading facility from February 1, 2025, is a positive move and represents a big boost to the investors. This initiative will empower and benefit investors with enhanced security, improved transparency, interest earnings and ease of making payments at a time when UPI payments are witnessing significant growth. This move will improve fund management and further enhance investors’ convenience, allowing them to create a payment mandate by blocking funds for trading which will safeguard their amount from misuse.”
