What is a Quarterly Settlement Payout Process?

What is a Quarterly Settlement Payout Process?

According to SEBI, if you have money in your trading account, it must be sent back to your primary bank account every three months. This is called "Quarterly Settlement of Funds" or "Running Account Settlement.” (Please refer to the SEBI's Circular- View)

We will transfer the money from your trading account to your bank account on the first Friday of every three months (January, April, July, etc.). But if the first Friday falls on a day when the stock market is closed, then we will transfer the money on the previous working day.

 The following are the important points related to Quarterly payout:

 A.  During the quarterly payout process, you will not be able to initiate any payout requests through the mobile application or web portal.

 B.  To ensure seamless trading on the next working day, which is usually Monday, we recommend transferring the funds back to your trading account in advance to avoid any last-minute challenges. (Click here – Fund transfer page)

 C. The entry for the quarterly payout will be reflected in your ledger statement as follows:

  

D.  When a client has an outstanding position on the quarterly settlement date, brokers are allowed to retain up to 225% of the End of the Day (EOD) margins.

 Example. Let's say you have Rs. 5, 00,000 in your trading account and you decide to buy ten lots of Bank Nifty. Each lot requires a margin of Rs. 30,000, so the total margin required for all five lots would be Rs. 3,00,000 (30,000 x 10). Now, the broker needs to maintain a 225% balance for the open position held by you. This means that the broker needs to block Rs. 6, 75,000 (3, 00,000 x 225%) from your account.

However, you only have Rs. 5, 00,000 in your account. So, the broker would block the entire amount and mark your account as "retained". This means that the broker will not refund any amount to your account.

 E.  The retention statement will be sent to your registered email ID once the settlement of your running account is completed. Additionally, we will send an email communication to inform you of the successful completion of the quarterly payout process for your account.


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