SEBI Waives Margin on Later Trades After Early Pay-In in Cash Segment
SEBI has announced that Clearing Corporations will not collect real-time margins on subsequent buy or sell trades up to the value of an accepted Early Pay-In. The framework takes effect four months from circular issuance.
- Issued by
- Securities and Exchange Board of India
- Notified
- 22 October 2026
What has changed
The Securities and Exchange Board of India (SEBI) has decided that Clearing Corporations (CCs) will not collect margin on a real-time basis from Trading Members or Clearing Members on subsequent buy or sell positions of a client, up to the amount of an accepted Early Pay-In (EPI). This applies when a client has a net sell obligation in a settlement and the EPI request for the sold securities has been successfully accepted.
Who it affects
This circular applies to: - Recognised Stock Exchanges - Recognised Clearing Corporations (CCs) - Depositories - Stock Brokers (Trading Members and Clearing Members) - Clients trading in the cash segment
Key details
- Valuation: Upon acceptance of the EPI, the CC will determine the available value of the EPI on the trade date as the lower of the value of the EPI done or the value of the securities sold.
- Margin Checks: When a client takes a new position on the same trade date in the cash segment, the CC will verify margin availability after reducing the available EPI value.
- Squaring Off Positions: If a client squares off a sale position for which EPI benefits were availed, the EPI value will be removed. Any margin shortfall at the client level will be blocked by the CC from the proprietary collateral of the Trading Member or Clearing Member.
- Exclusion for TFT Securities: The square-off condition does not apply to Trade for trade (TFT) securities because these are settled on a gross basis.
- Risk Management Requirements: Trading Members must ensure their risk management systems permit a client to square off an EPI position or take a new position only if the client’s requisite margins are available.
- System Updates: CCs are directed to update their systems, amend relevant bye-laws, rules, and regulations, and post the circular on their websites.
What it means for you
The circular was issued on 22 October 2026 and takes effect four months from that date. Investors in the cash segment can have their accepted EPI value counted to avoid margin collection on subsequent buy or sell trades up to that amount. However, clients can only square off these positions or initiate new trades if the necessary margins are available with their Trading Member.