Waiting for international ETFs and SLBM for domestic stocks
Will you allow selected stocks or all stocks available on their markets ?
Will we be able to purchase fractional shares in US Stocks ?
Will international stocks be available only on the USA market or are you considering EU, China etc ?
Most stocks.
Yes.
Only USA to begin with.
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Can ETFs, GSECs, bees and MFs also be lent/borrowed?
| Instrument | Can it be lent/borrowed in Exchange SLBM? | Under which system? | Who typically lends | Why they lend | Who borrows | Why they borrow |
|---|---|---|---|---|---|---|
| Equity shares | Yes (if in approved SLB list) | SEBI Exchange SLBM | Retail, HNI, Institutions | Earn lending fee while holding stock | Traders, Institutions | Short selling, delivery obligations |
| Index ETFs | Yes (only approved eligible ETFs) | SEBI Exchange SLBM | ETF holders | Earn additional yield | Traders | Hedge or short exposure |
| BeES (e.g., Nifty BeES) | Yes (treated as ETF) | SEBI Exchange SLBM | ETF holders | Earn lending income | Traders | Short / hedge exposure |
| G-Secs (Government Bonds) | No (not in exchange SLBM) | RBI “ Government Securities Lending (OTC) | Banks, Primary Dealers, Insurance, Large Institutions | Earn lending fee (GSL fee) on idle bond inventory | Banks, PDs | Short cover, settlement needs, repo strategies |
| Open-ended Mutual Fund Units | No | Not eligible instrument | Not applicable | Not applicable | Not applicable | Not applicable |
| Mutual Funds (as institutions) | Yes (can lend eligible stocks they hold) | SEBI via exchange SLBM | MF schemes | Earn extra income for scheme | Market participants | Short selling / delivery |
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Nothing, only charges when any transaction is involved.
@siva
Thanks for answering. I found the charges associated with SLBM little confusing. could you please clarify it by an example let’s say 100 shares (CMP 10,000) @ 0.13% for a month => 1300 Rs.
At some place it mentions total deductibles are around 322 Rs. [ What are the charges for SLB transactions?]
- 20% of lending fee+18% GST => 306 Rs
- Fix 13 Rs DP charges + 18% GST => 16 Rs
At another place it says “Subject to minimum 500 Rs” [Schedule of Charges]
- In the above example, would I be charged ₹500 instead of ₹322?
- Or does the ₹500 minimum apply in some other way?
Also, what exactly does the statement “As negotiated on a case to case basis” mean in this context? Who negotiates it, and under what circumstances?
Please clarify the above confusion.
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The ₹500 mentioned in the Schedule of Charges applies only to processing charges on negotiated transactions.
So in your example, you will not be charged ₹500 instead of ₹307. The ₹500 minimum applies only if a separate processing fee is agreed in a negotiated or structured transaction.
For normal exchange-based SLB:
• 20% of lending fee + GST
• DP charges + GST
If you still have specific doubts about a particular contract, you can always create a ticket from Zerodha Support, and the SLB team will assist you with transaction-level clarity.
Also, we are working on bringing SLB directly onto Kite. Once it goes live, the minimum eligibility values and processing fees are expected to be reduced.
Updates will be shared once it is rolled out.
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What kind of transaction is this exactly, how does it take palce and how is it different from exchange based SLB. Please provide me with the relavent documents/links/references.
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As informed in DM, the ₹500 mentioned refers to negotiated/structured SLB transaction.
Currently, we only facilitate exchange-based SLB and charge 20% of the lending fee + GST and applicable DP charges the ₹500 processing fee is not being levied.
Thanks for pointing this out. We will have this removed from the support portal.
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Do we have an online process to activate SLBM now? Last time I checked it was offline 
@Adarsh_Patil
activation is terminal based ( online) but the placing order is still sort of offline ( via creating ticket on Zerodha support).
new players like Dhan are way ahead of Zerodha in terms of facilities, charges and user experience.
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Yes! I’ve also confirmed with the support team that SLBM in Zerodha is still an offline process. Using it offline is time-consuming and lacks transparency. @Zerodha could benefit from being a bit more innovative here. NO doubt they are losing customers to new age brokers.
In Dhan I see that there are almost no volumes in SLB and the orders remain open for days. Also, it seems like everyone just wants to be a lender with hardly any borrowers. So what’s the point of having it then?
There are both borrowers and lenders in the market, which is precisely why SLBM exists.
.However, most brokers either do not have SLBM option or facilitate it through offline channels (No Transparency at all) and it is also possible that brokers are lending pledged shares directly as soon as demand arises (which I understand they may be permitted to do), resulting in no visible volume on the trading terminal. This lack of transparency needs to be addressed.
Best use case I can think of SLBM is for short delivery stocks , seller can get it from SLBM and offer to auction or directly .
I have not used this option - but i think its feasible .
I think once Zerodha and other main brokers offer this service online and reduce the stock no threshold then the SLBM will pickup .
What is minimum period for which I can borrow shares? 5 days 10 days? What is minimum amount charged by zerodha?
Is DDPI compulsory for borrowing shares? For lending shares?