Settlement of Running Account of Client’s Funds lying with Trading Member (TM)
Summary
This circular modifies the settlement schedule for running accounts of client funds held by Trading Members to ensure uniformity across stock exchanges. It mandates that quarterly settlements occur on the first Friday of October, January, April, and July, while monthly settlements occur on the first Friday of every month. Stock Exchanges are required to update their rules, monitor compliance, and report implementation status to SEBI.
Text
SEBI issued guidelines for settlement of running account of client’s funds / securities with a gap of maximum 90 / 30 days between two settlements depending on client choice.
Settlement of running account for securities has been discontinued and therefore, SEBI circulars dated December 03, 2009 and September 26, 2016, are now applicable for settlement of running account of client’s “funds” only.
The settlement of running account of funds of the client shall be done by the TM after considering the End of the day (EOD) obligation of funds as on the date of settlement across all the Exchanges on first Friday of the Quarter... If first Friday is a trading holiday, then such settlement shall happen on the previous trading day.
For clients, who have opted for Monthly settlement, running account shall be settled on first Friday of every month. If first Friday is a trading holiday, then such settlement shall happen on the previous trading day.
Stock Exchanges shall bring the provisions of this Circular to the notice of their members, make amendments to Bye-laws, issue operational guidelines, monitor timely settlement, enforce reporting requirements, and communicate implementation status to SEBI.
The provisions of this circular shall be applicable with effect from October 1, 2022.
This circular is issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992, to protect the interests of investors in securities and to promote the development of, and to regulate the securities markets.
Source: SecMarx — Settlement of Running Account of Client’s Funds lying with Trading Member (TM). Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.