Migrating to SEBI’s new system of Margin Pledge/ Margin Unpledge w.e.f. August 31, 2020

This is an important update for all customers subscribed to SAMCO’s StockPlus customers.

W.e.f. August 31, 2020, SEBI requires that all stocks that are to be pledged for margins should be via the depositories “Margin Pledge” system. You can refer the SEBI circular on margin pledge system here.

What does this mean?

This means that customers will now need to validate all their pledge and un pledge transactions via an OTP on the CDSL depository system. We wrote a post on how the new margin pledge/unpledge system will work here.

Also, all existing pledges will have to be migrated to the new system. Meaning pledges that were done prior to 31st August 2020 will be invalidated.

How will the migration process happen?

  • Step 1 – SAMCO will unpledge all securities that are currently held for margin under StockPlus and IntraPlus as on 31st August. This will be done irrespective of whether the client has placed an unpledge request. This is because we are mandated to return securities to client account latest by 31st August 2020.
  • Step 2 – SAMCO will initiate requests for margin pledge under the new system for your respective product – StockPlus/IntraPlus. Once we initiate the requests, you shall receive a link from CDSL via SMS/OTP to enter your OTP and authenticate your transaction. In case you don’t receive an SMS, you can check it on https://www.cdslindia.com/MarginPledge/OTP.aspx
  • Step 3 – Customers shall be required to authenticate the pledge via OTP. Only once the pledge is authenticated shall the pledge be valid and margins be available w.e.f. September 1, 2020. Please ensure that you authenticate the pledge before 7 PM on August 31, 2020.
  • Step 4 – SAMCO will accept the authenticated pledges and only those shall be available for margin purposes with effect from September 1, 2020.

What happens if you don’t authenticate the margin pledge as part of the migration process on August 31 2020?

In case you don’t authenticate the margin pledge, then there shall be 2 implications:

  • You shall not be able to avail of margin against shares for trading on September 1, 2020. You collateral against shares shall be zero
  •  In case of any margin shortfall for positions initiated earlier, you shall be liable to pay the penalty.

W.E.F September 1, 2020, all margin pledges for StockPlus and IntraPlus shall be done via the new margin pledge system.

For more details read: How to pledge or unpledge holdings with Samco under or StockPlus via CDSL.

 

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