Stock Brokerage Firms Hit by Sebi's New Uniform Charge Directive

Shares of stock broking firms like Angel One and Geojit Financial Services plummeted after Sebi mandated a uniform charge structure for all market members. Sebi's directive aims to ensure fair access and transparency by imposing equal charges across exchanges, clearing corporations, and depositories.

Shares of stock broking firms tumbled on Tuesday following a new directive from markets regulator, Sebi. The regulator has commanded stock exchanges and other market infrastructure institutions (MIIs) to implement a uniform and equal charge structure for all members, discarding schemes based on volume or activity.

As a result, shares of Angel One plummeted by 10.50%, Geojit Financial Services waned by 5.86%, Dolat Algotech dropped 5.39%, 5paisa Capital fell 4.51%, Motilal Oswal Financial Services dipped 3.70%, and SMC Global Securities declined 2.41% on the BSE.

Per Sebi's new directive, MIIs must ensure that charges recovered from clients adhere strictly to the fees specified. The charges implemented by these participant members should reflect true charges without deviations.

Moreover, the uniform charge structure is expected to lower overall fees, benefitting the end-client. "The new charge structure designed by MIIs should give due consideration to the existing per unit charges realized by MIIs, so that the end-clients benefit from the reduction of charges," said Sebi in a circular issued on Monday.

The regulator has tasked MIIs to follow additional guidelines when designing processes for charges levied on members, which are then passed on to end-clients. MIIs, being public utility institutions, are responsible for ensuring fair, unrestricted, and transparent access to all market participants.

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