The stock exchanges will lower transaction charges for the cash and derivatives market segments from October 1 to comply with the Sebi circular directing market infrastructure institutions (MIIs) to do away with the slab-wise charge structure.
The NSE will charge Rs 3,503 each side per crore of premium value in equity options from October 1.
The existing charges are in the range of Rs 2,950 to Rs 4,950 per crore of premium value for equity options, with trading members having premium turnover between Rs 3 crore and Rs 100 crore being charged the highest, and those with premium turnover of over Rs 2,000 crore being charged the lowest.
Similarly, the BSE said transaction charges for Sensex and Bankex options contracts will be revised to Rs 3,250 per crore of premium turnover. Its existing charges are same as those of the NSE, except that the BSE has an additional slab for members with up to Rs 3-crore turnover, for whom it charges Rs 500 per crore of premium value.
The changes will hit large broking firms and discount brokers, who currently pay lower charges due to high volumes they generate.
While the NSE has made changes to fees in the futures and cash market as well, brokers said the changes in the options segment are more significant in nature, and could hit their revenues.
On October 1, when these new transaction charges will come into effect, the higher securities transaction tax (STT) on derivatives trading will also be effective.
Ashish Nanda, president and digital business head at Kotak Securities, said, “In options, the reduction is Rs 2,894 per crore of round trip volume. The corresponding increase in STT in options is Rs 3,750 on a similar round trip volume. In short, a net increase of Rs 856 per crore in cost.”
As per the revised charges, the NSE will charge Rs 297 per crore of traded value in cash market and Rs 173 per crore of traded value in the equity futures market.
“MIIs being public utility institutions act as first-level regulator and are entrusted with the responsibility of providing equal, unrestricted, transparent and fair access to all market participants,” Sebi had said in its circular on July 1, directing MIIs to implement true-to-label charges.
The changes could also curb the surge in derivatives trading as there will be no incremental benefit for large brokers who generate high volumes. Futures and options trades contribute a significant chunk to the overall market trade.