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Brokers face fund crisis due to pre pay-in obligations 

Sujoy Manna  
Mumbai, March 15: A number of brokers are facing fund crisis as most stock exchanges are asking for pre pay-in to avoid any payment crisis on their settlement day.

According to a dealer of a leading brokerage firm, "The brokers are of the opinion that they are finding it difficult to collect funds from their clients. The clients, on the other hand, are complaining that they are finding it difficult to arrange for funds in advance. The brokers are not intended to bear liability. This has resulted in a fall in the volumes in the market." It can be mentioned that the National Stock Exchange (NSE), which had completed its highest ever pay-in of Rs 1,500 crore on Tuesday, witnessed a shortfall of Rs 45-50 crore even though the exchange had collected 50 per cent of its pay-in on Monday. The exchange sources added that the shortfall will be met by Friday. The Delhi Stock Exchange has asked all its brokers to deposit their margin money before the trading hours for amount exceeding Rs 10 lakh in a bid to avoid any payment problem in the market. The decision has been made effective from March 15 for the previous day's trading. The recent bear cartel, which pulled the Sensex downdrastically, led to a serious payment problem in the Calcutta Stock Exchange (CSE), which defaulted to the extent of Rs 90 crore on March 8, 2001. The exchange has also extended the scheduled pay-in date for the last settlement from March 15 to Saturday March 17.

Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.

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