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SEBI Set to Introduce ASBA-Like Facility for Secondary Market Trading

This will help investors to save as much as Rs 3,500 crore annually.

Securities and Exchange Board of India (SEBI), on 8 December, announced its plan to introduce an ASBA-like facility for trading in secondary markets.

Madhabi Puri Buch, Chief of SEBI, said this Application Supported by Blocked Amount (ASBA)-like a facility that is already available for the primary market to ensure that the investors’ funds only get moved when the allotment is completed.

Now, a similar facility will be available for the secondary market between January and February. This will help investors to save as much as Rs 3,500 crore annually.

Under the facility, the funds will remain in the client’s account but will be blocked in favour of the Clearing Corporation (CC) till the block mandate expires or till the block is released by the CC or debt of the block towards obligations that arises out of the trading activity of the client or whichever occurs first.

The settlement of funds and securities will be done by the CC without the need for handling client funds and securities by the member.

Madhabi Puri Buch said, “We are ready to introduce T+0 (T plus zero) settlement trade by the end of the current fiscal.”

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