“ICICI Direct charging 1% brokerage on forced liquidation – not disclosed in plan. Is this standard?”

Trading
1

Hi all,

I wanted to sanity check something with the community — this feels off, but I want to understand if this is standard practice or a disclosure gap.

:pushpin: Situation

I hold a PRIME 4999 + iValue plan with ICICI Direct.

As per my plan:

  • Delivery brokerage: 0.10%
  • System square-off charges: ₹50 per order

Recently, ICICI force-liquidated pledged securities (SAM collateral) due to margin shortfall / system-triggered action.

:money_with_wings: What actually happened

On these forced liquidation trades:

  • ₹24.47L trade → ~₹24,470 brokerage
  • ₹44.71L trade → ~₹44,714 brokerage
  • ₹6.60L trade → ~₹6,605 brokerage

:point_right: Effective brokerage = ~1%

:exclamation: My concern

ICICI’s response is:

“System square-off uses spot brokerage (1%)”

But:

  • This 1% is NOT mentioned in my subscribed plan
  • Not disclosed in Commodity FAQ or Shares as Margin (SAM) FAQ
  • The only reference is a buried ‘spot selling’ FAQ under stocks
  • No prior notification or consent before liquidation

:warning: Why this feels problematic

  • These were forced (RMS-driven) trades, not voluntary
  • I had no control over execution or timing
  • Yet I’m charged 10x my plan brokerage (0.10% → 1%)

Also, the term “spot brokerage” is used without stating that it could be as high as 1%, which seems materially misleading.

:thinking: Questions for the community

  1. Is this standard across brokers during forced liquidation?
  2. Has anyone else faced ~1% brokerage in ICICI system square-off cases?
  3. Shouldn’t such a material charge be explicitly disclosed in the plan itself, especially for non-discretionary trades?
  4. Can FAQs override clearly defined plan-level brokerage terms?
  5. What is the economic purpose of charging 1% brokerage amount on the liquidated collateral? What specific costs or funding obligations did the broker incur during liquidation that would justify charging materially higher brokerage?

:brain: My current view

This seems less about the rate itself and more about:

Material pricing not being clearly disclosed in context where the client has no control (forced liquidation)

:pray: Looking for inputs

  • If others have seen similar behavior
  • Whether this is considered acceptable industry practice
  • Any guidance on escalation (if this is indeed a disclosure issue)

Thanks in advance — trying to approach this objectively before taking it further.

5 Likes
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I prefer to stay away from big brokerage firms because they often don’t work in favor of small investors like me.

What seems simple at first can come with hidden fees and complex terms that slowly eat into hard-earned savings.

Since these firms are so large, it’s difficult for an individual to challenge them if something goes wrong, even if you are right.

I’d rather stick with discount brokers that are more transparent and give me better control over my money.

2 Likes
3

I have tried many brokers. ICICI Direct is the worst of the worst satanic-sinful-bottom-of-the-barrell entity imo. Their confusing plans and hidden charges are designed to loot hapless customers.

Btw this 1% ‘spot brokerage’ nonsense is actually allowed by regulations. Max of 2.5% is allowed.
Ofc Z (or other discount brokerages) doesn’t have such dirty charges.

7 Likes
4

Few years ago one of my friends begged me to open demat account in icici because he had to meet target, told me there is no maintenance charges, later they charged it so i paid and told them to close my account, there was no online option to close account so i called customer care and they told me in order to close demat account i have to travel to bengaluru and close account in their office, their business so full of shit i traveled and paid extra 750 for closing account. I don’t know why people do transactions with such brokers

2 Likes
5

Another scummy practice of utilizing non cash margin first, so that they can charge interest:

2 Likes
6

Hope he’s still not a friend.

1 Like
7

Maybe they are giving users a free course on Dark Patterns

Bait and Switch:

Bait and switch occurs when users are promised one outcome but receive something entirely different.

Roach Motel:

This pattern makes it easy for users to sign up for a service but excessively difficult to cancel. It’s designed to trap users, exhausting their patience to keep them subscribed.

I fell bad that companies are allowed to easily manipulate or deceive us like this, without any repercussions.

https://www.eleken.co/blog-posts/dark-patterns-examples#:~:text=Image%20sources:%201%2C%202,but%20receive%20something%20entirely%20different.

1 Like
8

If you are still using ICICI Direct you are great. Its a sure way of losing money in terms of Brokerage charges , trading through ICICI Direct !!

1 Like
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Quick observation, my friend trades on ICICI Direct, and I always wondered why.

He pointed out a feature on ICICI Direct that no other stock brokers in India can afford to offer to their clients. It’s subtle and easy to overlook, but once you notice it, the value can be massive, possibly worth tens of thousands per month.

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i expressed my experience here with trading through ICICI Direct , ultimately the Brokerage charges matters its a business not an emotional thing. Brokerage structures of Zerodha or the lesser brokerages then zerodha only works

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ICICI Direct also only offers ‘Regular’ MFs :slight_smile:

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12

Do you want us to ask “What feature?”. I’ll bite. What festure? :face_with_peeking_eye:

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Apreciate input on the regulation which allows the spot brokerage upto 2.5%? My concern is that they did disclose it in my brokerage plan, or in commodities FAQ or in Shares as Margin FAQ. Can they charge it even if they did not disclose it and hence is wasnt part of the contract with the client? Why does nobody take them to courts for contract violation?

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Yes, very convenient policy for them. I have witnessed this in my account as well, their policy makes it impossible not to pay them interest if you end up pleding any shares as collateral

1 Like
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Thanks. I fail to understand how they can continue the material non disclosure and charge people when they failed to disclose it in the brokerage plan, commodity FAQ, shares as margin FAQ and bury the FAQ under buried ‘spot selling’ FAQ under stocks. Are there no laws on what forms a contract? Why isnt anybody taking them to court to get them to change their disclosures and contracts?

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I am with icici direct. what is the feature, even I want to know. @RupeeRiser

2 Likes
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is it 3-in1 or 4-in 1 account so that one earn interest on account balance and also one can take loans , or Bucket trading in FX & Crypto !!:thinking: