SEBI has issued show-cause notices to over 115 stockbrokers, including top brokerages, for continuing their association with algo marketplace Tradetron despite previously claiming compliance with a 2022 circular. The circular prohibits promoting or associating with platforms offering algorithmic trading strategies promising assured returns.
SEBI’s investigation revealed brokers still had their APIs integrated with Tradetron, which facilitates algo trades, violating the directive. Tradetron admitted some brokers had paid for integration, but only a few requested disconnection, which wasn’t fully implemented.
WazirX creditors pressed founder Nischal Shetty and the restructuring team for clarity on representation in the committee of creditors (CoC) and on redistributing potential crypto market gains during the restructuring process. The company was granted a four-month moratorium by a Singapore court to restructure its business after a security breach in July resulted in a $230 million loss. WazirX is exploring white knight investors and aims to provide updates in the next few months, with a 10-member CoC to be formed by October 9 to consult on the process.
SEBI has issued guidelines for AIFs, their managers, and key personnel to ensure compliance with regulations and prevent misuse of asset structures. The checks focus on preventing RBI-regulated entities from evergreening stressed loans through AIFs, ensuring ineligible investors don’t act as QIBs or QBs, and ensuring funds from countries bordering India comply with approval rules.
Due diligence is required for schemes involving RBI-regulated investors or land-bordering countries, with reporting obligations for significant investments.
An SBI-led committee has recommended removing the 18% GST on co-lending activities between banks and NBFCs and restricting co-lending to priority sectors due to higher risks elsewhere. The report emphasizes the need for dedicated co-lending departments, a common channel between banks and NBFCs, and separate appraisal and risk processes.
Co-lending, aimed at boosting credit to underserved sectors like agriculture and MSMEs, has seen slow uptake since RBI’s approval in 2018. Co-lending portfolios are expected to grow significantly, reaching ₹1 trillion by June 2024.
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