SEBI’S NEW MARGIN TRADING RULES
                     SEBI’S NEW MARGIN 
TRADING RULES
INTRODUCTION
• The Securities and Exchange Board of India 
(SEBI) introduced a framework of margin 
collection in the cash segment.
• Here one needs to pay for the securities 
purchased within two days to the stockbroker
Source: FinnovationZ
NEW RULE
• The new margin rules have come into effect 
from September 01, 2020 after SEBI's refusal to 
extend the deadline to implement the new 
rules on margin pledge any further. 
Source: Elearnmarkets
IMPOTANT DATES
• These norms came out earlier this year in February 
and were initially scheduled to come into effect 
from June 1. 
• The date was then extended to August 1 and 
thereafter to September 1. 
• While the brokers and other participants 
requested more time to make their systems ready.
Source: The Financial Express
OLD SYSTEM
• Under the old system, cash margins were taken 
care of by the broker. 
• Investors either had to transfer their shares to 
the brokers’ account or give power of attorney 
(POA) to the broker. 
• Some brokers went on to misuse the POA 
assigned to them.
Source: Deccan Herald
CHANGES IN RULES 
• The stock will continue to remain in investor's 
demat account and can be directly pledged to the 
clearing corporation. 
• As the securities remain in investors’ own demat 
account, they will enjoy all corporate benefits on 
their shares.
Source: Moneycontrol
MANDATE RULES 
• It is mandatory for brokers to collect margins from 
investors upfront for any purchase of sale of 
shares. Failing to do so will attract a penalty.
Source: The Economic Times
POWER OF ATTORNEY (POA) 
• No Power of Attorney (POA) to be assigned to 
brokers. The investors used to give authority to the 
brokers by way of POA to execute transaction on 
their behalf. 
• The POA cannot be used for pledging anymore.
Source: Elearnmarkets
MARGIN PLEDGE
• Investors who want to avail margin now must 
create margin pledge separately.
• Earlier collecting upfront margin wasn’t 
mandatory, but under the new system, investors 
will have to pay at least 30% margin upfront to 
avail a margin loan.
Source: Medium
EQUITY/STOCKS
• Currently, n investor can use intraday realized 
profits for taking new positions on the same 
trading day. 
• According to the new norms, you will be able to 
use it only after T+2 days in case of equity/stocks 
once you receive the delivery of shares in your 
account.
Source: Vinay’s Blog
MARGIN RULES OF SEBI
• Previously clients needed to meet margin 
requirements in their account once at the end of 
the day. 
• But, the new margin rules of SEBI will require them 
to fulfil their margin obligations at the beginning of 
the deal.
Source: Trade Brains
THANK YOU