Zerodha CEO Nithin Kamath has welcomed a major regulatory shift, allowing stock brokers to invest their own funds freely without needing prior approvals from exchanges. The Finance Ministry and NSE clarified the Securities Contracts (Regulation) Rules (SCRR), 1957, removing restrictions that previously classified such investments as ‘business activity’.
🔴 Key Highlights:
- Brokers can now invest their own money—as long as client funds or securities aren’t involved.
- The rule change benefits fintech investment arms like Rainmatter, Zerodha’s startup funding initiative.
- The Finance Ministry amended Rule 8 of the SCRR, ensuring that investments made by brokers won’t be treated as business unless they create financial liabilities.
- Kamath called the move a ‘game-changer’, stating that Zerodha can now allocate more capital to support Indian startups directly.
📢 Nithin Kamath’s Statement:
“Finally, after clarification of SCRA rules by @FinMinIndia and NSE, brokers can now invest their own funds without exchange approvals or restrictions. This is huge for @Rainmatterin.”
⚠️ Strategic Impact:
- The rule change enhances ease of doing business, allowing brokers to diversify investments beyond securities.
- Fintech startups could see increased funding, as brokerage firms expand their investment portfolios.
👉 What do you think? Will this rule change boost startup funding in India? Drop your thoughts in the comments!
🔴 Share this post to keep investors informed! 🚀🔥
