SEBI Examines Brokers' Representation on RBI Draft Norms, Key Issues Under Review, Chairman Reveals

SEBI Examines Representations from Stockbrokers on Banking Guidelines

SEBI Chairman Tuhin Kanta Pandey stated that the Securities and Exchange Board of India (SEBI) has received a representation from stockbrokers regarding operational challenges arising from proposed banking guidelines. This matter primarily falls within the regulatory domain of the Reserve Bank of India (RBI).

The RBI recently floated draft guidelines tightening the provision of funding and non-fund based facilities to capital market intermediaries, including brokers and trading members. In response to these guidelines, brokers had approached regulators seeking relief and clarity.

Pandey clarified that the RBI had already issued the draft guidelines and sought stakeholder feedback. SEBI's role will be limited to reviewing the concerns placed before it. The representation from stockbrokers relates to issues around bank guarantees and the amount of collaterals required for proprietary trading.

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SEBI will examine the issues in detail before determining its next steps. It remains to be seen whether SEBI will formally convey industry feedback to the RBI.