How can I pledge my shares in NRE account to trade in derivatives as the orbis tieup does not allow pledge?

Hi Zerodha Team, It is very dicey situation and Please help to find some solution.

  1. I have nre account with zerodha which has my stocks holding, I have PIS account linked to it.
  2. I am not able to make use of these holding to pledge and trade against it. I have spoken with your partner Orbis and they told they only allow F&O with cash.

Could you please find some solution to it. It is a standing issue and I am looking for solution remaining on zerodha platform. If there is no solution, I may need to find alternatives.

For NRI, remittance can be done in NRE as it has some tax benefit.

please respond and see if requirements can fit in please.

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Appreciate update on this concern please

Maybe this will be of help (copied from zerodha). From the below it seems NRI cannot pledge their holding and obtain margins.

  1. The brokerage charges for futures and options are Rs 100 per order.
  2. The NRI client cannot pledge their holdings while trading to obtain margins.
  3. The NRI client isn’t allowed to trade on the equity segment using the same account.
  4. Funds are to be transferred to the Orbis account and all withdrawals will need to be requested from their end.

NRE account trades are reported to the Depositories {CDSL & NSDL} and RBI. One is allowed to trade in equities only through this account {No F&O trading} is allowed.

NRE holdings cannot be pledged to obtain margins for F&O trading as these are 2 different accounts. Additionally, with NRE account - pledging stocks is restricted by FEMA regulations & PIS regulations {NRE}:

Here’s a snapshot of the same for your kind perusal; Please check this link for the Notification

However, you may be able to pledge shares from an NRO {non-Repatriable} account with the custodian. Currently, there isn’t a process through Zerodha for the same. This is being worked with Orbis. There’s no timeline for now. You’ll be updated once this is available.

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