SEBI/HO/MIRSD/MIRSD -PoD1/P/CIR/2025/1 — THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992

CIRCULAR SEBI/HO/MIRSD/MIRSD -PoD1/P/CIR/2025/1 To, All recognized Stock Exchanges Madam / Sir, Sub: Measure for ease of doing business - Settlement of Account of Clients who have not traded in the last 30 days SEBI, vide Circular no. SEBI/HO/MIRSD/DOP/P/CIR/2021/577 dated June 16, 2021 (hereinafter mentioned as 'Circular') and Clause 47 of Master Circular for Stock Brokers dated August 09, 2024 (hereinafter mentioned as 'Master Circular'), issued guidelines regarding settlement of running account of client's funds by stock brokers . Currently, in terms of clause 5.4 of the Circular dated June 16, 2021 and clause 47.4 of the Master Circular, the account of clients who have not done any transaction in the last 30 days are required to be settled by the Trading Member (TM) within next three working days. It has been represented by Brokers' Industry Standards Forum (ISF) that this requirement necessitates TM to identify such clients daily, potentially leading to the daily settlement of client funds and resulting in procedural inefficiencies. It has further been represented that since the client funds are anyway upstreamed to the clearing corporation, there is a need to revisit the time for settling such client's funds. Based on the above coupled with the recommendations received from Brokers' ISF and with a view to facilitate ease of doing business as well as to safeguard the investors' interest, it has been decided to revise the requirement of mandatory settlement of such clients' funds. Accordingly, it has been decided that the funds of such clients who have not traded in last 30 calendar days shall be settled on the January 06, 2025 upcoming settlement dates of monthly running account settlement cycle as notified by Exchanges in the annual calendar issued by them from ti