Mumbai: The capital market regulator Sebi has proposed to revise the criteria regarding levy of annual maintenance charges (AMC) by stock market brokers on demat accounts of retail investors. Currently, according to rules and regulations of Sebi, if the value of debt securities (bonds) and any other type of securities (shares) kept in the demat account of a retail investor is up to Rs 1.50 lakh at any given time for a period of three months from the date of opening of the account, then, brokers cannot levy any AMC.
Now, Sebi has proposed that brokers cannot levy the AMC even if value of the securities kept in the demat account increases more than Rs 1.50 lakh and go up to Rs 4 lakh. According to the new proposals, brokers can levy the AMC only if the combined value of all the different type of securities kept in demat account increases beyond Rs 4 lakh.
The market watchdog has also proposed that if the combined value of all types of securities kept in demat account is more than Rs 4 lakh and goes up to Rs 10 lakh, then, brokers can levy maximum AMC of Rs 100.
Other proposals put forwards by Sebi is that if the securities kept in retail investor’s demat account goes beyond Rs 10 lakh, then, brokers can treat the demat account as regular account.
Current and proposed AMC structure:
Value of Holding in Demat A/C (in Rs)
Combined Value of Holdings of All Security Types (in Rs)
Maximum AMC
Up to 1.50 Lakh
Up to 4 Lakh
NIL
In any other case
More than 4 Lakh to up to 10 Lakh
100
Value of securities more than 2 Lakh OR value of other than debt securities more than 2 Lakh
More than 10 Lakh
AMC to be levied as in case of Regular Demat A/Cs
Source: Sebi
These proposals of Sebi will indirectly help reduce AMCs levied by different brokers on demat accounts of small investors. According to the market regulator, the whole purpose of the new proposals is to help India achieve wider financial inclusion and facilitate ease of investing for retail investors. The capital market regulator wants to encourage holding of demat accounts in the country. As of March 2024, there were over 15 crore demat accounts in the country.
The capital market regulator, Sebi, has proposed to increase the bandwidth of value of holdings of securities kept in demat accounts from current Rs 2 lakh to Rs 10 lakh for levy of Annual Maintenance Charges (AMCs). Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
