What is the impact of Quarterly Settlement on clients?

What is the impact of Quarterly Settlement on clients?

Effective October 1, 2022, 5paisa has laid out the following guidelines as per SEBI Circular dated 27072022 regarding the settlement of client's running accounts for funds, which will occur on the first Friday of every quarter:

1. Clients who have traded or have open positions and a debit balance:

o Such clients will be deemed settled on the first Friday, as mandated by SEBI.

2. Clients who have traded during the quarter but have no open positions:

o In cases where the client has traded during the quarter but has no open positions as of the settlement date, any excess credit balance in the ledger account will be transferred to the client's registered default bank account with broker.

3. Clients with open positions:

o For clients with open positions on the settlement date (i.e., the first Friday), the broker can retain an amount equivalent to the following:

a. The entire pay-in obligation of funds across segments on the settlement date

b. 50% of the end-of-day (EOD) cash margin requirement

c. 225% of the EOD margin reduced by 50% cash margin and the value of securities (after haircut).

o Any credit amount exceeding the above calculation will have to be transferred to the client's bank account.

Please ensure that your bank account details are up-to-date to facilitate a smooth transfer process in compliance with the regulations and enjoy hassle-free quarterly settlements with 5paisa.