Stockbrokers are required to transfer all unused funds back to the client’s bank account as per SEBI regulations at least once a quarter. The next quarterly settlement date is 6th January 2023.
Check out this post from October 2022 for details on the regulation.
Payout Calculation
Some of our clients have asked us how the quarterly settlement amount is calculated. It depends on the (1) unused funds available in the account, (2) the value of pledged securities, and (3) the margin utilised by presently outstanding positions.
Here is a sample calculation of unused funds & the quarterly settlement payout.
| Formula | Particulars | Amount | Remarks |
|---|---|---|---|
| A | Ledger Balance | 100000 | Assumed |
| B | Unsettled funds | 10000 | Assumed |
| C= A-B | Settled Funds | 90000 | |
| D | Margin Used | 30000 | Assumed |
| E | Exchange Payins (Losses, buyer’s obligations) | 15000 | Assumed |
| F | Cash Collateral | 20000 | Assumed |
| G | Non-Cash Collateral | 20000 | Assumed |
| H = F + G | Total Collateral | 40000 | |
| I = C - E | Cash Available for QS | 75000 | |
| J = D x 225% | Retainable Margin | 67500 | |
| K = (D x 50%) | Margin Retained from Cash | 15000 | |
| L = J - K | Left-over Margin to be Retained | 52500 | |
| M = Lower of L and H | Margin Retained from Collateral | 40000 | |
| N = L - M | Additional Cash to be Retained | 12500 | |
| O = N + K | Total Cash to be Retained | 27500 | |
| P = I - O | Quarterly Settlement Payout | 47500 |
Explanation of the above calculation
Read more on this FAQ doc from NSE.