MTF(Margin Trading Facility)

[nithin]

@VenuMadhav

Thanks for your feedback. One can have endless debates about how much one should charge, even in the above threads, there’s request for 12.5, 12 If it was 12.5, questions would be why can’t it be 11.5, in line with what our NBFC charges as rate of interest for loans availed. The comparisons can be endless.

We believe what we’re charging is fair, and reflects the value of the service we provide.

To add to what @VenuMadhav said, it is charging enough to cover the overnight risk. With LAS (Loan against security), the haircut is 50%; that is, you can borrow only 50k for pledging stock worth 1lk. The risk is lower, and hence, we charge around 11.5%. In the case of MTF, you can trade something worth Rs 1lk with as low as Rs 20k in your account. The risk for us is much higher hence we charge ~15.7% (0.04% compounded daily).