In the third week of October, brokers from across India had gathered at the Taj Lands End hotel in Mumbai for their first mega physical gathering since the onset of the pandemic. The dignitaries gracing the event included senior exchange officials and regulatory officers. The mood was celebratory — the brokers had enjoyed a dream run for two-and-a-half years as the number of demat accounts crossed the 110 million mark. They had raked in the moolah through brokerage fees, investor participation, and interest income, some of which had accrued from investor money kept with them for trading.
But amid all the backslapping, there was an underlying current of unease over a massive structural shift expected to happen soon, one that could potentially alter the way brokerages do business. Markets regulator Securities and Exchange Board of India (Sebi) does not want brokers handling investor money anymore.