16 February 2017
New Delhi
Reporter: Drew Nicol

India offers fee savings boost to lending

The Indian National Securities Clearing Corporation has offered an olive branch to the National Stock Exchange securities lending market by introducing an incentive scheme that would see larger transactions rewarded with cuts to charges.

The new rates, which will be effective from 1 March and remain in place for 12 months, will apply to all new lending transactions, but not rollover transactions, and could see participants save as much as 2 percent per transaction from the current monthly flat rate of 2.5 percent.

Transactions worth INR 10 million (USD 149,250) will receive the maximum 2 percent benefit, taking the transaction tax down to 0.5 percent.

Transactions valued between INR 5 million (USD 74,500) and INR 10 million earn a 1.25 percent cut, while those worth between INR 1 million (USD 15,000) and INR 5 million are entitled to a 0.75 percent discount.

The Indian National Stock Exchanged processed 8,203 securities lending transactions in December 2016, registering $187.1 million in notional turnover.

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