Understanding the new margin pledge system — effective Aug 1, 2020

July 21, 2020

Check this bulletin for updates

The three principal objectives stated under SEBI’s preamble are:

  1. To protect the interests of investors in securities;
  2. To promote the development of the securities market; and
  3. To regulate the securities market.

If you’ve been following the actions of the market regulator closely, you’ll notice a spate of regulations introduced in recent years, all conscientiously aimed at protecting the interest of investors. From reporting of client level cash & bank account balance to standardising leverage across the industry, all steps culminate in achieving the three principal objectives listed above. The new pledging mechanism too is aimed to further safeguard investors.

A brokerage is the custodian of client funds & securities. When you transfer funds or stocks to your broker, you’re entrusting him/her with the responsibility of handling these assets without any prejudice. That said, there still are reports of brokers misusing client funds and/or securities entrusted to them. In the aftermath of these episodes, SEBI has taken further steps to strengthen the regulatory framework which has led to the genesis of the new pledge-unpledge system for stocks.

When you want to trade with your broker, you need to maintain margins for your trades. Margins can be in the form of cash or stocks. Transferring cash is straight forward. As far as stocks are concerned, today, when a client wants to pledge his stocks to obtain margins, he has to transfer securities from his account to the broker’s account. The broker then pledges these securities to the Clearing Corporation. This transfer of title (ownership) of the securities leaves a gaping hole in the system, allowing (certain] brokers to misuse these securities.This problem was addressed by introducing the new pledge system that will go live from August 01, 2020.

In the new pledge system, the stocks don’t leave the investor’s demat account, instead a pledge is marked in favor of the broker. The broker is required to open a separate demat account labelled ‘TMCM – Client Securities Margin Pledge Account’ for this purpose (TMCM stands for Trading Member Clearing Member). The broker then re-pledges these securities in favour of the Clearing Corporation and obtains margins.

Some of benefits of the new pledge system are as under:

  1. No misuse of securities: Since stocks don’t leave the investor’s account, there’s less chance of misuse of securities. Also, it wouldn’t be possible to pledge one client’s stocks to offer margin to a different client.
  2. Corporate actions: In the existing pledge system, since the stocks are held in the broker’s collateral account, the broker is the recipient of all cash and non-cash corporate actions like dividends, bonus, rights, etc. While the broker is required to voluntarily transfer these benefits to the investor, a non-savvy investor may miss out on claiming such credits in the event that the broker doesn’t.
  3. Pledge allowed for all approved securities: Some brokers (including Zerodha) don’t accept pledge of all instruments allowed by the Exchanges. For example, certain liquid funds pay dividends in the form of more units of the same fund. The operational nightmare around reconciling the dividends received and transferring them to the investors has held us back from accepting these instruments as margins. Going forward, since the stocks are all held in the client’s own account, any approved security will be accepted for pledge.
  4. Facility to sell pledged stocks: This is a feature we’re working on making available, allowing you to sell pledged stocks without having to request for unpledge and wait until they are received to your demat account. With the new pledge system it becomes much easier to deploy this. This covers the risk from market movements in the stocks you’ve pledged.

What will be the process at Zerodha going forward?

We’ve largely kept the process unchanged, except having to add a few additional steps whereby a client is required to authorise the pledge by entering an OTP on CDSL’s website, just like the TPIN based pre-authorisation for selling stocks. Since CDSL is still working on building full fledged APIs, the investors will have to access this link through an email sent to them to enter the OTP and authorise the pledge. The process is explained below:

  • Log into Console.
  • Go to the Holdings page. A list of stocks that can be pledged is displayed here.
  • Select the stock you wish to pledge, enter the quantity, and click on pledge.
  • CDSL sends an email to your registered email ID with a link to approve the pledge
  • Upon visiting the link, an option to generate OTP is given. This then sends an OTP to the registered phone number & email ID. Enter the OTP on the CDSL page to approve the pledge.
  • Once the pledge is approved, margins will be provided against the pledged stock from T+1. Once the full fledged APIs are available, we’ll work at providing near real-time margins against pledge.
  • To unpledge, simply visit the holdings page and request an unpledge. The stocks will be unpledged from the Clearing Corporation (provided they aren’t blocked for margins) that is the lien on the stocks will be unmarked and the stocks become free securities in the demat.

The fee for pledging will continue to remain the same. This is because there’s a cost levied by the depository to create the pledge and re-pledge. Additionally, also note that as a client you’ll have to continue maintaining positions in the cash:collateral ratio of 50:50, failing which interest will be levied. If you fail to meet your margin obligations, the broker will have the right to invoke the pledge and sell them to revoke the dues.

All new pledges will have to be created through the new pledge system effective August 01, 2020. Brokers have been given time until the 31st of August to return all securities pledged using the existing framework and route them through the new pledge system. In due course, we’ll communicate the process of un-pledging to you. Please ensure to maintain sufficient margins for the positions you’ve taken.

Update: SEBI, vide this circular has allowed the present system of margin pledge to be available till the 31st August 2020. The new pledge system will be made live soon and in due course, we’ll communicate the process of un-pledging to you.

Venu

Operations @ Zerodha

226 comments

  1. Sachin says:

    For existing pledged shares, are you going to charge un-pledging and pledging charges again?
    what if client used SLB for pledged shares? will that be allowed?

  2. AK says:

    Once the stock unpledge during the day, will i be able to sell the stocks on the same day or next day ?

    • Matti says:

      Not right away, but we’re working on making this possible.

    • Bala says:

      If i want to sell options how much cash required in account (1 lot banknifty at 250)

    • Sumit says:

      Yes, we are waiting for the facility to allow us to sell pledged share directly without waiting for unpledge. Sometimes we have F/o position against pledge, which we don’t want to square-off but want to sell pledged stocks at the same time.

      • Manu Manjunath K R says:

        If u but FO using margin money to should either pay in for the position as at present u used margin money. Without paying margin money u can’t sell margin pledge shares

  3. samudra says:

    Will it affect the current margin level, like 6% for CO for HUL? Will it get reduced?

  4. jithinj v says:

    Will it effect the intraday leverages provided by zerodha??

  5. Sachin Singh says:

    80 % of my money is invested & pledged with Liquid/Overnight funds.
    a) So till 31st July, I can continue taking overnight positions with the pledged money as well, right?
    b) For people who are already invested & pledged somewhere, the time is till 31st August to switch to the new system?
    b) Till around when can we expect some clarity on unpledging and then pledging again? One day before & on expiry day, full margin is needed, so hopefully some time will be given to switch over.

    Thanks.

    • Matti says:

      a) Yes.
      b) & c) Yes, we will email you first and then unpledge your existing pledges. You can re-pledge immediately.

      • Johar says:

        To unpledge, I will have to close all my positions and unpledge . If I close my positions today, can I unpledge today itself or wait for a day ?
        To open positions again, I will have to wait for day as margin will be available only after that. Am I right ?

      • johar says:

        if we re-pledge, will you give margin immediately, or will take a day to give. what will happen to positions with out margin ? do we need to pay short fall margin penalty ? I have 2cr margin. that means I have to pay 2L per day penalty till I get margin ?

        • Matti says:

          You will need to have margins for your positions. Positions may be squared-off or attract penalties if not. Since this is a regulatory change, we are required to unpledge and you would need to re-pledge. However, we’ll do this activity over a weekend so you can re-pledge easily. Margins from re-pledge will be available from T+1.

          • johar says:

            So to be specific,
            I will have to close all my positions that need margin from Pledged Shares/MF on 31st Evening . You will unpledge over weekend. On Monday(3rd August) I will have to re-pledge. I will receive margin on Tuesday. then I can enter positions. Is this correct. ( I will be out of business from Friday night to Tuesday)
            Can we distribute this process through out Auguest ?

  6. Abinav says:

    What all securities are currently available to be pledged which Zerodha is not providing due to operational overhead as mentioned in the post?

    Can i find the list someplace?

  7. Shanay Khemani says:

    Currently, Zerodha doesn’t allow pledging of SGB’s. With the new change will I be able to pledge my SGB’s as well?

    • Matti says:

      No, SGBs aren’t on the approved list of securities for pledging.

      • Shanay Khemani says:

        As per NSE, they are allowed for pledging. But not in the Zerodha list of approved securities. Had a support ticket raised regarding this as well. What am I missing?

        • Geetika says:

          Absolutely, Matti please answer this. There indeed are so many SGBs (different tranches) at NSE list of approved securities.

          • Manu Manjunath K R says:

            That’s because it’s not liquid…if u could provide margin losses then broker can’t sell it buying n selling is very less

  8. What about quarterly settlement says:

    Is there any changes regarding repledging on quarterly basis

  9. Mach says:

    Please expand your pledge list and include corporate bond and other debt funds and also all equity funds available on coin.

  10. Poonam says:

    Will POA still be required ?

  11. Pradeep Kumar inani says:

    I rather find strange that you are suggesting that current stocks which are pledged needs to be unpledged and repledged .

    The new system entails that security would now reside in clients dmat account, so you can transfer it from your pledged pool and immediately shift it TMCM account of the client . All the new pledge action can after the cutoff date can follow the new procedure.

    By adopting unpledging and repledging process lacs of Rs would be moped from investor as they would be required pay pledging charges two times.

    This certainly would make investors poorer by this amount.

    • Matti says:

      No Pradeep, that’s not possible since the new pledge requires you to approve the request by an OTP sent to your registered contact details as explained in the post above.

  12. Nirav says:

    Regarding ” All new pledges will have to be created through the new pledge system effective August 01, 2020.”

    The new pledge system starts in Console also from 01 August 2020 ?

  13. Naeem says:

    sir what about old clients we also want tpin security for selling shares.when it will start for old customers.

  14. Mani says:

    All new pledges will have to be created through the new pledge system effective August 01, 2020. Brokers have been given time until the 31st of August to return all securities pledged using the existing framework and route them through the new pledge system.

    Does the above statement mean that – we can manually un-pledge old framework and shift to new framework step by step all through August (30 day window) ?

    The reason i am asking is – i have Dec 2020 Options selling Positions which are using the Equity pledge Margins … It would be nice if i dont lose the “Margins Fully” from Equity Pledge while the pledge is transferred from the old framework to the new one … If i have the 30 day window in August to shift in phases (20% of my portfolio each day) – that would be nice

  15. Moinu says:

    Sadly we haven’t seen any goods steps taken by SEBI when LEEL , ILFS, etc failed.

  16. Pritesh Vora says:

    I am planning to invest in a liquid fund and Gold ETF and provide this investment as collateral. Shall I wait till 1st August?

    • Matti says:

      You can invest at any time. While you can pledge now too, the pledge will be reversed by Aug 31st if you do it before Aug 1st.

  17. Dominic Savio says:

    Sir,
    What is the minimum qty to pledge?
    Is to possible to use the pledged margin to buy a stock for delivery?.
    Thanks in advance

  18. Shakun Kothari says:

    Is this anyway connected to Collateral Hair Cut Percentage deduction benefits Or it will remain same

  19. Harish K says:

    Will the haircut remain the same for liquid bees?

  20. Shivaprasad says:

    Hi Venu,

    Thank you for the nice explanation. I wanted to understand the impact of this change on “Good till trigger” orders.
    Can you please explain thsi.

  21. Venkatasubramani P says:

    Thanks for the update. Please allow to pledge MF also with haircut. 50% Cash 50% security should be good.

  22. Adarsh says:

    NRIs can get MARGIN in doing pledge?

  23. Kiran Kumar says:

    Are you going to allow Sovereign Gold Bonds as Collateral?

    If not kindly allow SGB as collateral. It’s long pending request.

  24. Smit says:

    When will pledge against Equity Mutual funds will be reality ? ETF are good instruments, but the spread between NAV and the trading price makes it less effective.

  25. Shyamal says:

    For existing open position against collaterals of existing stocks, how the margin requirement will be monitored during switching over process of custody of stocks from broker’s account to client’s demat account. It may not be possible for clients to arrange for full margin for open positions in the transition.

  26. Sanjeev Khemani says:

    Hi,

    1. In the extremely unlikely scenario of a broker default, will my pledged shares remain safe as long my balances are clear ?
    2. Can we also have the link of Sebi circular(s) to this effect ?

  27. Vandana says:

    The cost of pledge is high it should get reduced once APIs are developed.
    Moreover the the facility of selling pledged security should be given so that the client can use that money to fund delivery obligations arising from some f&o position

  28. Narender says:

    What are the pledge charges ?
    If I will pledge my liquid funds.

  29. SOURENDRA KUMAR DEY says:

    CL BR5462 When Bracket order will be enable?

  30. Pankaj says:

    Is it have anything to do with CNC orders?
    I’ve purchased shares of a company on BSE for long time holding. What will I have to do while selling it?
    Please guide.

  31. PRADIP BHASKAR GUPTE says:

    User code QX9250
    When POA is given why separate pledge? Brokers can give margin after allowing haircut

  32. Ashish says:

    I do not want to pledge any share but will maintain sufficient fund balance instead. Will this be possible?

  33. Sunil Gathani says:

    This may be a good implemets.

    But i think trade volume will be reduced or it will take more time to increase trades once the limit is over.

  34. MAHESH KUMAR VERMA says:

    Dear Sir
    I wish to know if I have sufficient cash balance in my Account still I am required to Pledge my holdings. Kindly clear
    Regards

  35. Sachin says:

    Could you please advise on
    1. Options call and put buying inrelation margin amount require to buy premium amount.
    2. Should margin amt require at the time of exit option which is bought earlier.

  36. Archit Agrawal says:

    Sir,
    (a) I have pledge of Bharat Bond and Axis Liquid Fund with CDSL OTP in July-2020. Does it still need to unpledge & pledge to fall in new system
    (b) In new system also, restriction of Rs 2 lac per scrip and Rs 10 Lac/day will remain ?

    • Matti says:

      A) Yes.
      B) No.

      • Archit Agrawal says:

        Thanks.

      • Shrinidhi Rao says:

        Hi,

        I tried to pledge a scrip of more than 3 lac.
        I get an error “Failed to pledge/unpledge: You cannot pledge more than Rs.200000 for the same instrument. You are exceeding it by Rs.100959.4912”.

        Also, if I pledge less than 2 lac, I didnt receive a mail from CDSL to confirm the pledge. Is the new system active?

        • Nakul says:

          Hey, currently, there’s a limit of 2L per scrip and 10L overall per day when you are pledging from your account without a POA. The new pledge system isn’t live yet. SEBI has allowed implementing these changes by 01st September. We are working with CDSL to make it live as soon as possible. You will receive communication once the new system is live.

  37. Karan says:

    If I have open overnight positions (options sold) using my pledged margins in liquid funds, will I have to compulsorily square off my trades during the re-pledging process? What can be done so that there is no loss of business

  38. Suhas Khullar says:

    Why is there a limit of RS 2 lacs per scrip imposed at Zerodha? Will this go away as a part of this change?

  39. yogesh koundal says:

    Sir I want to know that if i have holdings in my demat account, so to sell those holdings do i need to provide the upfront margin in advance from now onwards, as i am holding bajaj finance from last 10 years so its value is big and it’s upfront margin is huge amount.

  40. santosh kumar says:

    pledging charges are one time or we have to pay every month and its 60+gst or there is any other charges?

  41. ANOOGNA SURESH BABU says:

    dividend received for pledged shares has not been credited to my trading account as per your norms
    after how many days will zerodha transfer these amounts from broker account to clients account
    ref

    clienrt id DA6517
    hdfcamc 150 shares pledged
    div amount 28×150=4200 not credited
    kindly clarify

  42. Kishor says:

    Sir, In new system, shares pledged and margin limit created. May I use this margin to buy NIFTY PUT or NIFTY CALL ?
    Please clear my doubt

  43. Preeti says:

    Hi Sir,

    Can you please be kind enough to explain the intraday transactions in ZERODHA post 1st Aug 2020, with steps it will be useful. Also please let us know how much margin do I need to keep and where etc ????

  44. NARENDRA PRATAP SINGH TOMAR says:

    Is intraday leverage will be affected for banknifty option selling
    From 1 august 2020 or later

  45. Ganesh says:

    How long I can use the margin ? and How interest will be calculate or reduce. Is that interest reduce daily basic ?

  46. Ganesh says:

    Interest is only for over night holding or interest is charged for intra day trading as well ?

  47. Melwin says:

    The fee for pledging will continue to remain the same. – Please clarify on this. Saw a news that above 1 lakh it is more charge like 0.5%. Does that mean if I pledge 1CR I have to pay 50K ??

  48. Mani says:

    Can we continue to use Margins from old framework of Equity pledge till End of August (31st Aug 2020) ?

  49. Abhishrk says:

    Will liquidBees and few other liquid mutual funds still considered as 50% cash equivalent now while pledging

  50. Shrinidhi Rao says:

    Hi, is the new system enabled now?
    I jus tried but didn’t receive the mail or OTP to approve the pledge as mentioned in instructions above.

  51. Nitin says:

    Hi Team,

    If i transferred 50k in my account , i get margin immediately. if i buy something in CASH of that amount and sell on T1.
    Currently i am able to do that , will there be any change in that ? or i need to wait to get stocks in my CDSL account ?

    Regards

  52. ronit says:

    does intraday mis product in futures will not be allowed?

    • Matti says:

      This has nothing to do with intraday products but talks about the mechanism for pledging shares. Nothing changes for you.

  53. Amol Potekar says:

    I have buy shares in delivery option Friday 31st July 2020 , I want to sell tomorrow is it allowed?

  54. Vatsal says:

    Is the new pledge system live ?
    Can we start unpledging old securities and re pledging them ?

  55. Ashok says:

    Hi,

    I have unpledged all my shares on Friday 31, July, 2020 and raised new request for pledging today Sunday 2nd, Aug, 2020. However i have not received any link from NSDL for OTP validation.
    Is new system not effective, pls reply.

  56. Sachin says:

    Is new system in place and working?

    • Nakul says:

      Not yet. SEBI has allowed the implementation of the new system by 01st September. We’re working with CDSL to take it live as soon as possible.

      • Shanay says:

        I have placed a pledge request today. Would this request be cancelled or will the pledging occur in the previous method today?

      • Rajesh Mahendran says:

        If that is not the case then the page should have been updated earlier soon after. What about people who have unpledged by seeing your notification . I personally have unpledged more than 15 pledged scripts. If I have to pledge now and repledge when new margin pledge rule comes in. Who will bear all this charges ?

        • AYUSH GUPTA says:

          Exactly…Even i did the Same…I have not taken any position from 31st July and Unpledged all my liquid fund to pledge again!!

          @Zerodha… Do tell us will the repledge will be in new pledge system or not?

          • Rajesh Mahendran says:

            @Ayush I would suggest you to pledge it again. As per zerodha customer care it would take another one week for them to implement it. I have wasted my week trading gain due to this along with unnecessary pledging charges. Pathetic service guys @zerodha. We atleast expect you guys to update the post so that others won’t do the same mistake like us.

  57. Shankar says:

    I request Nithin to post regular updates on the status of implementation of the new system at Zerodha on Zerodha’s Twitter account to avoid inconvenience and additional charges for the clients.

  58. Siddharth Kumar says:

    @all – This post is *not updated*.

    Feature is not live yet. Still it is using old method only and stocks are getting debited from Demat account.

    Please refrain from unpledging and re-pledging to avoid additional charges.

  59. Siddharth Kumar says:

    @Admin – Do we need to repledge Liquid funds as well ? Or this rule is applicable for stocks only?

  60. AYUSH GUPTA says:

    (1)Please guide us..When we can expect the new margin system to go live on zerodha( tentative date at least)

    Actually from 31st July,many of us have not taken any positions just because of new margin System.

    (2) After receiving POA,in how many days It will be effective in our account and how do we know,POA is effective.
    (Since in CDSL Tpin,2lakh per script capping is there, I dont wish to spent Rs 60 every time)

  61. Rajesh Jain says:

    this question is for nifty option writing.
    i am having equity delivery holding of 50 Lac against which i am getting margin of say 40 Lac.
    I am using this margin for Nifty option writing for carry forward position without having any cash balance in my account. generally i sell today and square-off next day and again take new position of Nifty option writing by end of day.

    How new SEBI rule will affect me ?

  62. Essen says:

    In the new system, how the margins required for a naked and covered (on stocks) call going to be different?

  63. HD says:

    I have pledged some mutual fund on august 6 unit and it got debited from my account. Why the new system was not followed?

    • Nakul says:

      We should be live with this by next week. SEBI has permitted the implementation of the new system by 01st September 2020.

  64. Sunil says:

    When will this feature be live?

  65. Manikandan says:

    Thanks for the detailed article.

    Can i leave the pledge for longer duration? Say i have liquid funds used as collateral for 50% and remaining 50% through cash. Will there by any interest for longer duration pledges? or is it mandatory to frequently unpledge post the trade?

    • Nakul says:

      There won’t be any interest as long as there’s no shortfall in the cash component. Also, it isn’t mandatory to unpledge.

  66. Akhil says:

    Will liquidBees and few other liquid mutual funds still considered as 50% cash equivalent now while pledging?

  67. Ravi Kankuwala says:

    Hi, as per new SEBI margin rules, how much margins will be required to sell banknifty futures intraday now? how much money i need to keep in my account to short 1lot of banknifty futures in intraday now?

  68. Abhishek says:

    Apart from the pledging process will the list of funds currently considered as 50% cash equivalent also change as per new process.
    Kindly comment on above query please

  69. Sachin says:

    Today my pledged shares were automatically unpledged and I can see them in holdings, so I believe new system is live.
    If I pledge them now, that will be in the new system?

  70. Saurav Goyal says:

    Hi,

    I have been pledging my holdings in the past. Today i.e. August 11 i was trying to pledge my Yes Bank shares purchased in FPO, but i can’t see the option of pledging the same against YES Bank shares. Is it because of the new rule or it is not allowed in Yes Bank only.

    • Nakul says:

      Hey Saurav, the new pledge system isn’t yet live. We’ll notify you once we have it in place. Currently, we are not taking pledge requests for YESBANK. We’ll look at allowing it in the new pledge system.

  71. Vatsal says:

    Dear Team ,

    I want to pledge some securities to start trading just wanted to have a idea if the new system is going live by end of this week so that i can wait or if it is gonna take time till end of month then probably ill Pledge under old system now.

  72. Amruth M says:

    Please let us know the date when the new system will go live. We will plan accordingly. It will be difficult to unpledge and pledge if we have any positions.

  73. Vikas says:

    How many shares i can buy in banknifty if open some strikes open interest only 1000 shares in strike can i take position 800 shares.?
    There is any rule for position limits?

    • Faisal says:

      Vikas, there are no restrictions on strike wise OI. You can hold 100% of the OI for that strike too.
      Positions limit apply at 5% of the total OI for an underlying(All Banknifty F&O OI).

  74. Santhosh says:

    Any specific date you have in mind to go live with new pledging system next week?

  75. DINESH says:

    Hi,

    I bought a stock today on delivery by paying full cash. If I intend to sell it tomorrow, should I pay and upfront margin.?
    Please guide me in this regard..

  76. DINESH says:

    Hi,

    I bought a stock today on delivery by paying full cash. If I intend to sell it tomorrow, should I pay an upfront margin.?
    Please guide me in this regard..

  77. Dheeraj says:

    Hi Team,
    I have 52 securities pledged at the moment…are you saying that I will have to again pay 52 * 75 = 3900/- once the new system goes-live?
    I think, for an existing pledged security, it should have been dealt in a more professional way to save retail investors by either:
    * Negotiating with CDSL to not charge anything
    OR
    * Broker (Zerodha) should borne half of the new pledge fees

    Hope I am making some point!

    Kindly consider!

    Thanks,
    Dheeraj

  78. Shankar Reddy says:

    Dheeraj, I echo your views. I had the same thoughts. The instruction to the CDSL/NSDL and Brokerage firms to waive off the pledging charges or reduce the pledging charges to a bare minimum for existing pledged securities should have come from the SEBI when it announced mechanism for the new process. At least, this should have been implemented for the month of August. Unfortunately, SEBI ignored or lacked thinking in that direction.

  79. Dheeraj says:

    Yeah…but if SEBI hasn’t thought in that direction, broker should bring it into their notice since non-discount brokers such as Sharekhan anyways don’t charge for pledge/unpledge!

  80. Shankar Reddy says:

    I don’t think Brokerage firms will voluntarily bring to the notice of SEBI, because new mechanism (repledging) is an opportunity for the Brokerage firms to get additional revenue/income. It is beneficial for them.

  81. Dheeraj says:

    Would await Zerodha folks to comment!

  82. Shubh says:

    I second Dheeraj. It would be great if Zerodha can look into Waiving/Reducing pledging charges while migrating from the old pledge framework to the new pledging framework, also make the process of doing it with least friction (many traders are utilizing the existing pledge to hold overnight positions)

  83. Sachin says:

    Hi Matti,

    Last week On Monday my shares were unpledged. Till date no announcement on new system being live.

    Now if I need margin I’ll have to pledge the shares in the old system and you’ll un-pledge them whenever you’ll feel like.

    And again you’ll give no assurance on when new system will be live.

    In all this unprofessional behavior you’ll not forget to take pledging/un-pledging charges.

    On top I’ll miss some trade opportunities as well, due to lack of margin.

  84. Santhosh says:

    Matti had gone underground in search of answers to our questions????

    Zerodha…. Please provide some answers to our questions above… Time is the essence here…

  85. Amruth M says:

    Hello, Please update when the new system will go live. If it is going to take few weeks I will pledge using the current system.

  86. Shashank says:

    I have unpledged and repledged the share to check the new system but the new system is still not live. Now again when the system will become live we have to do this process again which again charge some amount. Can we get the notification once the system is live.

  87. Jignesh says:

    New margin pledge system is live? Please work on that and make it live asap such that we can gradually move our holding from old system to new system without impacting F&O positions.

  88. Heena says:

    Hi,

    I had unpledged and re-pledged my securities in 1st week of August after getting notification from your side about new pledging framework.

    Zerodha has also deducted the pledging fees again in August and this has also resulted me loss of trading opportunities for whole 1 week.
    And now you are telling us to again repeat this process? Why should we do it?

    As suggested by you, we have already done this process.. this has resulted me loss of good amount of money in 1st week of August.

    Who will compensate for it? Isn’t it extremely unethical from Zerodha’s part?

  89. Vijaya Ezhilraj says:

    Has the new margin system come live..? My holdings has been unpledged by Zerodha. I am waiting to repledge it if the new one has been implemented.

  90. Santhosh says:

    Sharekhan already provided the date for re-pledging will start from Monday 24th August. When will Zerodha tell us?

  91. mayank says:

    Suppose i hold few shares in my demat under some other do participant (read shares bought through another broker) can I pledge those shares to gain margin on zerodha

  92. NGK says:

    I want to understand in simple terms. What if I don’t want to pledge my shares and want to buy shares only when I have money in my trading account, what do I have to do?

  93. Dheeraj says:

    While Sharekhan has already mentioned pledge/unpledge process, are you guys aware if MF pledging in Sharekhan is also enabled online now?

  94. Ramesh Sehgal says:

    How will Liquidbees be treated in the new system.After selling them will we have to wait for T+2 days for trading against them?

  95. KABILAN says:

    Any updates on this when it will be going live. Only one week more for the last date

  96. Vikas says:

    Zerodha,

    What has happened to you? You were always so quick (earlier) in responding to updates to new procedures/processes!

    I am tracking this page on daily basis.. why there is no update coming here?
    All other brokers have already intimated their users with respective pledging steps!

    I am utilizing margin through pledged Liquid mutual fund units, Please tell me will there be any interruption in my trading due to new system?
    I have already undergoing positions in F&O segment.

  97. Vikas says:

    Hi, When this “new” system will be available. can this be notified to all clients who have already pledged their holdings? Note that this is really becoming over hang and unable to take effective position due to un-certainties

  98. Nishant Sharma says:

    Not able to pledge EDELWEISS BHARAT BOND FOF – APRIL 2023 units purchased through Coin app. I bought this only for the purpose of pledging as it was listed in the securities available for pledging by zerodha. Please help why pledging option is not showing up.

  99. Krishnajith says:

    You have to buy it from Kite APP. EBBETF0423

  100. Chikkayya Mathapati says:

    Hi Team,

    could you please tell me is it possible to get collateral margin from Mr. X who has pledged in his demat and he is going to lend me that Margin and that margin will be used only Mr Y instead of Mr. X, please clarify.

    Thanks,
    Chikka

  101. Krishna says:

    Just got response from support team. ” New pledge system is not live yet. Zerodha is waiting for 1st September and working… Email notification will be sent.”

  102. Chinmay says:

    Hi
    I am unable to figure out as I am not getting reply from support when the new pledging method will go live so there is least inconvinience caused

    • Matti says:

      Hey Chinmay, the new pledging system is now live. All new pledge requests are being routed through the new system since yesterday.

  103. Shashank Kumar De says:

    As per CDSL, news published on 24th August that margin pledged and unpledge charges has be reduced to 5 from 12, can you please confirm if there will be addition charges from broker side also for the same

  104. Jaffer says:

    Lets say i have pledged 100 share of xyz company and I want to pledge again 200 shares. Will there be pledging charges levied for increasing the quantity of stocks of same company ?

  105. Rajani kant says:

    i deal in futures more than cash , what is this pledging i am not understanding, I do BTST, Intraday and positional in futures , will this system affect my operation , can u give one example by taking a script

  106. Vikas says:

    Did anyone use new system

  107. Atul says:

    All my pledges were abruptly revoked yesterday. My account is now showing a HUGE NEGATIVE BALANCE.

    The new CDSL OTP system is not working when I made a new pledge. This in UNACCCEPTABLE.

    Call me URGENTLY to FIX THIS.- you can get my contact details by mapping my email id.

  108. Shankar Reddy says:

    Hello Matti,

    Thanks for the update on the new pledge system going live.
    Is this process automated now? I am curious if the scrips are pledged on Holidays (Saturday and Sunday), would we receive mail from CDSL same day? If authorized by the client with the OTP same day, would the margin be available on Monday morning?

  109. Pappu Minglani says:

    Hi,

    How to make sure that the Pledgee BO ID as displayed on the CDSL pledge OTP webpage is of Zerodha only.

    1) We dont know Zerodha’s BO ID.
    2) There is no mention of Zerodha’s name on the CDSL webpage.
    3) This becomes more confusing if someone is pledging to multiple brokers.

    Basically how to be sure that the Pledgee BO ID and the Broker match.

  110. Vatsal says:

    Hey Matti ,

    Good to hear about New pledge System going live.
    Had a query – What about Old Securities which are already pledged ? Do we need to manually Unpledge or it will be done automatically from your end ?

  111. jamesvaikom says:

    I am new here. My old brokerage firm allow me to do intraday and take delivery with the value of shares I hold in my demat account. I had to transfer money only in T+2 days. As that is not possible here I may have to pledge shares to do intraday. If cash balance in my account is 0 then can I do intraday with margin money I get by pledging shares? Will I have to pay interests if my account balance become -ve due to intraday loss even if I transfer money in T+2 days?

  112. Bala says:

    CDSL website is unable to generate OTP. Been trying for so long. What to do now?

  113. saurabh goyal says:

    CDSL page not working , not getting OTP and received mail from zerodha it should be done before 8 PM today.

  114. Prateek Gupta says:

    CDSL margin authentication not working. The page is showing error after putting OTP. Kindly check into it team Zerodha. this 8 pm deadline is like ticking bomb for some trader.

  115. abisha says:

    unable to generate OTP..system error.

  116. Arijit says:

    In the new system, I want to change the quantity (from earlier) of stocks to be pledged. How this can be done? I am getting the quantity which was pledged earlier.

  117. Pramod says:

    OTP not generated….error on page…. Please HELP!!!

  118. Sunny Borah says:

    In motilal oswal I could pledge all securities without any issue as they intimated well in advance , but in zerodha they are intimating at the last moment. As millions of customers are trying to pledge, there is heavy traffic to CDSL website n the site is crashing.

    Zerodha should have done this last weekend itself as they knew this issue would happen. Now if we can’t pledge shares due to last minute changes, zerodha will either liquidate our positions or charge penalty for non of our fault. I think we should reach out to consumer forum incase there is any loss due to liquidation. I don’t understand what zerodha was doing for last 2 months.

  119. Varun says:

    Till date ie before 31 Aug 2020, CDSL is charging just Rs 12 for pledging and un pledging particular scrip then why Zerodha is charging Rs 70 including GST from its customer.

    Really fail to understand when other brokers are charging zero fee for pledging and un pledging then why zerodha is charging money for the same and on the top of it is five times more then what CDSL is charging. Kindly advise reason for this discrepancy..

    Also, per latest notification, CDSL has further reduced pledging and un pledging charges to Rs 5 per script then why zerodha is not reducing the same and suggesting its customer it will continue to remain the same post 31st Aug 2020 . Kindly advise reason for this discrepancy as well.

  120. Reena says:

    Thanks for ZERODHA Team. I pledged all my holding in New Pledge System and confirmation mail received from CDSL.

  121. Rajesh says:

    Hi,

    With the new pledge system, will I be able to see all my holdings in Kite (like in Console->Holdings)? Currently the pledged shares are visible only in Console and Kite shows only free hold shares.
    It will be good to see consolidated view of my holdings in Kite as well may be with a marker P: x (of Y) like (T1: 50) 100.

  122. Rahul Rattan says:

    Hello I just confirmed my pledge on CDSL website, however the pledged shares have disappeared from my holding (console). Values of pledged shares have been reduced from my total investment. where have the pledged shares gone? Have received a message and an email from CDSL that my pledged request is successful. totally cluless what is happening and whats happened to my pledged shares. Pls reply

  123. Amit Gupta says:

    Same here. suddenly my entire holding + pledge has come down drastically. pledge shares are not appearing. dont know whats happening.

  124. Sassy says:

    Hi, Holdings and pledge had gone negative. This is poor execution by Zerodha. They had setup automated calls etc to inform us about new pledge system. But havent given a clue that some pledge will be amiss for a while. With so many newcomers/retailers, they should advise us of this rude shock which we may receive during re-pledge process. Should have included this in Risk-Assessment to avoid customer panic.

    BTW, you can check holdings in CDSL Website by logging in using BO-ID and PAN.

  125. Sanchit Gulati says:

    I have a simple question.
    I have invested 1 Lakh total in 3 scripts and I only buy-sell in cash i.e. I use only what I have and don’t use extra margin.

    Will the new margin pledge rule effect me?

  126. Rahul Rattan says:

    No it wont impact you, its only for traders who pledge their equity holding and use the margin to trade in F&O.

  127. Shivam Choudhary says:

    As I pledged my shares, my shares have vanished from my holdings.
    Just got a mail that your pledge is successful.
    a) Where have my shares gone?
    b) What will be the procedure to unpledge them back?

  128. Samudra Dutta Gupta says:

    I have the same issue, and the ONGC stocks are rising now, without me getting any option to get it UNPLEDGED. Please help quickly. This time, I am seeing, more delay than usual from your side. Any major issue?

  129. Yogesh Agarwal says:

    i just wanted to confirm that we will not be able to get intraday margin like 10x on cash stocks, as we were getting by today ?

  130. PREETI MOHANTY says:

    In the new system, Zerodha has a great disadvantage. It does not permit pledged securities on real time basis, where as Brokers allow it. At Zerodha, it takes more than 2 days, as you have to first unpledge them, for which they take minimum 2 days. This should be brought to the Notice of SEBI.

  131. Mahesh Kumar Verma says:

    To some extent I have understood the process, but there are rounds in the market that even to sell the share in our dp we have to maintain the margin there is some confusion. And where we have sufficient funds with the brockers

  132. GP says:

    Once the pledge is approved, margins will be provided against the pledged stock from T+1. Once the full fledged APIs are available, we’ll work at providing near real-time margins against pledge. For this my suggestion is that
    SEBI can introduce options like.,instruct all the clients to pledge it on the weekend. So that clients can utilize margin from monday onwards instead of T+1.

  133. GP says:

    Going forward, since the stocks are all held in the client’s own account, any approved security will be accepted for pledge.
    So do you accept FD as collateral or not?. Keenly waiting for reply.

  134. Abhimanyu Kalra says:

    What’s the reason behind keeping 20% of the scrip value before selling the scrip.

  135. Srikant says:

    Since 3 days my pledged shares worth 10lacs have vanished from console and I haven’t received any repledging request from Zerodha for those. Can you please let me know what has happened to my shares.

  136. kiran S says:

    Do I need to maintain any upfront funds in my account to sell any my holdings ? Also can i use the funds on the same day to buy some other stocks after selling my positional holdings ?

  137. Pritesh says:

    Hi, Can I buy shares on delivery base, using available pledged shares’ margin? if yes, in how many days do I need to settle the ledger in cash?

  138. umesh says:

    can we use pledging amount for trade in long cash segment

  139. Basavaraj says:

    Actually I am not understanding what is pledge unpledge. pls explain it properly I have holding many shear’s so is it any issue ??

  140. PRADEEPTA KUMAR JENA says:

    As per new Margin Pledge System, if I pledge some of my share, can I get the Margin which can be utilised for delivery based trading?

  141. Mallesh Gowda says:

    Sir,
    I could not change and do unpledge and repledge my Liquid Bees.What shold I do now.I have enough funds in account.What should i do now.Please guide

  142. PREETI MOHANTY says:

    Zerodha yet to provide facility for live sell of pledged securities by client without going through unpledging process. Clients are at a disadvantage to miss out any short term spurts in value. When other Brokers e.g. ICICI and Aditya Birla are providing this facility, why Zerodha is not able to do so? After all funds remain with Zerodha for any margin requirements..

    • Matti says:

      Preeti, the stocks are pledged with the clearing corporation, so selling without unpledging wouldn’t be possible, or right. We’re working on the instant unpledge process to allow you to sell pledged stocks.

  143. Devendra Dholakia says:

    What is the percentage of haircut on the pledged equity shares?

  144. Deepak Kumar says:

    How much fee can be collected by Zerodha on pledging the stocks ??

  145. sandeep karmarkar says:

    sir how i can short shares in intra day if i am not holding shares in my demat account and in account i have Rs.50000/- so how much exposure i will get can i buy it on same day?

  146. Naveen Jain says:

    I am existing Zerodha client for more than 5 years. Using pledge/unpledge system for couple of years.

    Now, with new system, Pledging is working fine, but unpledging IS NOT WORKING.

    Raised unpledge request on Sep 03, 2020, but it is still pending. Created support ticket #20200904940285 on Sep 4, 2020, but support team is not able to resolve.

    Pl resolve it ASAP, as I am not able to exit this positions.

  147. Gopalakrishnan says:

    I pledged some shares of xyz company, not utilising the margin that mean no F&O position.
    Case 1 : Due to some sudden rally, I sold the shares without unpledge it. What will happen?

    Case 2 : I sold shares and placed unpledge request simultaneously. Because delivery is T+2 and unpledge is T+1. Will it work?

  148. Sangeeth says:

    Can we pledge share for intraday buying only??? Or we can pledge and buy stocks for BTST or Swing trading??? Please advice….

  149. Amit says:

    So frustrating to be with Zerodha. We understand this is a pandemic time but You should know you are a stockbroker, not a grocery shop that I can buy stocks from others if you are unavailable. Why so huge call waiting?? Trying to contact zerodha since the last 2 months but no LUCK. its been 7 months now. why haven’t you hired enough resources to help your clients?? It’s all about money.

  150. rahul says:

    Hi,

    Can we have the bracket orders back with higher margins if required?

    It helps us to be more disciplined as if have to enter target exits and stoploss. Thanks.

  151. Kailash mahto says:

    I have apply for pledged on 08.09.2020. But otp not received till yet

  152. Vineeth says:

    Sir. I request you to kindly let me know if I can use the collateral margin for covering mark-to-market losses.

  153. Sumit says:

    We are waiting for the facility to allow us to sell pledged share directly without waiting for unpledge. Sometimes we have F/o position against pledge, which we don’t want to square-off but want to sell pledged stocks at the same time.

  154. Megha Gupta says:

    Hi,
    I just got to know about the Pledge system today and wondering what this is all about and what am i supposed to do. Here is the story.

    I have only stocks lying in my demat account and i have not maintained any cash in the funds. Please confirm what all actions i am supposed to do?

    – Do i need to deposit any cash in my funds? If yes, how much
    – For the unpledge/repledge, what is the process & how much charges will it levy? I have about 3 lacs worth stock, with the new system, how much money will be charged in the process?

  155. Bharat says:

    Where can I find the complete list of approved stocks for pledging along with the percentage margin given?

  156. Arul says:

    Hi,
    If I have pledged my ETFs to buy shares, can i pledge the bought shares again, say, to do options trading?

  157. BHARAT BHUSHAN MANOCHA says:

    Just want to know 1 thing

    can we use margin against pledged shares for taking new delivery or not

  158. Sreenivas Ramaswamy says:

    Waiting for implementation of the facility to sell pledged stocks without going through the unpledge process which takes a day resulting in a lost opportunity. As a leading brokerage firm it would be great if this is made available at the earliest.

  159. Rishi says:

    I’ve 110 shares of EBBETF0431F (Bharat Bond) when i try for pledging i am getting a failed message as mentioned

    “EBBETF0431F(INF754K01LE1) cannot be pledged. Maximum Qty of shares that can be pledged at trading member level reached.”

    So far i didn’t have not pledged securities and this is the first time, Can you tell me the reason and also telll when i will be allowed to pledge this security.

  160. Niraj says:

    I have 1334(2 lots) shares of SRTRANSFIN in my account which are already pledged. I have sold call options for 2 lots which are ITM currently. I would like to give delivery of these shares at the end of expiry. Do I need to do unpledge these shares ? Or will the call option be exercised without making any modifications.

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