Investor Charter
(1) Vision
To follow highest standards of ethics and compliances while facilitating the trading by clients in securities in a fair and transparent manner, so as to contribute in creation of wealth for investors.
(2) Mission
To follow highest standards of ethics and compliances while facilitating the trading by clients in securities in a fair and transparent manner, so as to contribute in creation of wealth for investors.
- To provide high quality and dependable service through innovation, capacity enhancement and use of technology.
- To observe highest standard of compliances and transparency.
- To ensure confidentiality of information shared by investors unless such information is required to be provided in furtherance of discharging legal obligations or investors have provided specific consent to share such information.
- To establish and maintain a relationship of trust and ethics with the investors.
- To always keep ‘protection of investors’ interest’ as goal while providing service.
(3) Service Provided to Investors by stock brokers include
- Execution of trades on behalf of investors.
- Issuance of intimations regarding margin due payments.
- Periodic Settlement of client’s funds.
- Risk management systems to mitigate operational and market risk.
- Information sharing with the client w.r.t. relevant Market Infrastructure Institutions (MII) circulars.
- Communicating Most Important terms and Conditions (MITC) to the client.
- Issuance of Contract Notes.
- Facilitate execution of early pay-in obligation instructions.
- Issuance of retention statement of funds at the time of settlement.
- Facilitate client profile changes in the system as instructed by the client.
- Provide a copy of Rights &Obligations document to the client.
- Redressal of Investor’s grievances.
4) Rights of Investors
- Ask for and receive information from a firm about the work history and background of the person handling your account, as well as information about the firm itself (including website providing mandatory information).
- Receive a copy of all completed account forms and rights & obligation document.
- Receive account statements that are accurate and understandable.
- Access your funds in a prescribed manner and receive information about any restrictions or limitations on access.
- Get the copies of all policies (including Most Important Terms and Conditions) of the broker related to dealings of your account.
- Get only those advertisement materials from the broker which adhere to Code of Advertisement norms in place.
- Trade in derivatives after submission of relevant financial documents to the broker subject to brokers’ adequate due diligence.
- Get access to products and services in a suitable manner even if differently abled.
- Get access to all the exchanges of a particular segment you wish to deal with unless opted out specifically as per Broker norms.
- Have access to the escalation matrix for communication with the broker.
- Receive complete information about the risks, obligations, and costs of any investment before investing.
- Receive a copy of ‘Most Important Terms & Conditions’ (MITC).
- Understand the terms and conditions of transactions you undertake.
- Receive complete information about maintenance or service charges, transaction or redemption fees, and penalties in form of tariff sheet.
- Close your zero balance accounts online with minimal documentation.
- Not be discriminated against in terms of services offered to equivalent clients.
- In case of broker defaults, be compensated from the Exchange Investor Protection Fund as per the norms in place.
- Getwarningsonthetradingsystemswhileplacingordersinsecuritieswhere surveillance measures are in place.
- Get access to educational materials of the MIIs and brokers.
- Deal with one or more stock brokers of your choice without any compulsion of minimum business.
- Not be bound by any clause prescribed by the Brokers which are contravening the Regulatory provisions.
5) Various activities of Stock Brokers with timelines
| Sl.No | Activities | Expected Timelines |
|---|---|---|
| 1 | KYC entered into KRA System and CKYCR | 3 working days of account openingg |
| 2 | Client Onboarding | Immediate, but not later than one week |
| 3 | Order execution | Immediate on receipt of order, but not later than the same day |
| 4 | Allocation of Unique Client Code | Before trading |
| 5 | Copy of duly completed Client Registration Documents to clients | 7 days from the date of upload of Unique Client Code to the Exchange by the trading member |
| 6 | Issuance of contract notes | 24 hours of execution of trades |
| 7 | Collection of upfront margin from client | Before initiation of trade |
| 8 | Issuance of intimations regarding other margin due payments | At the end of the T day |
| 9 | Settlement of client funds | First Friday/Saturday of the month / quarter as per Exchange pre- announced schedule |
| 10 | ‘Statement of Accounts’ for Funds, Securities and Commodities | Monthly basis |
| 11 | Issuance of retention statement of funds/commodities | 5 days from the date of settlement |
| 12 | Issuance of Annual Global Statement | 30 days from the end of the financial year |
| 13 | Investor grievances redressal | 21 calendar days from the receipt of the complaint |
6) DOs and DON’Ts for Investors
| Sl.No | DOs | DONT's |
|---|---|---|
| 1 | Read all documents and conditions being agreed before signing the account opening form. | Do not deal with unregistered stock broker. |
| 2 | Receive a copy of KYC, copy of account opening documents and Unique Client Code. | Do not forget to strike off blanks in your account opening and KYC. |
| 3 | Read the product / operational framework / timelines related to various Trading and Clearing & Settlement processes. | Do not submit an incomplete account opening and KYC form. |
| 4 | Receive all information about brokerage, fees and other charges levied. | Do not forget to inform any change in information linked to trading account and obtain confirmation of updation in the system. |
| 5 | Register your mobile number and email ID in your trading, demat and bank accounts to get regular alerts on your transactions. | Do not transfer funds, for the purposes of trading to anyone other than a stock broker. No payment should be made in name of employee of stock broker. |
| 6 | If executed, receive a copy of Power of Attorney. However, Power of Attorney is not a mandatory requirement as per SEBI / Stock Exchanges. Before granting Power of Attorney, carefully examine the scope and implications of powers being granted. | Do not ignore any emails / SMSs received with regards to trades done, from the Stock Exchange and raise a concern, if discrepancy is observed. |
| 7 | Receive contract notes for trades executed, showing transaction price, brokerage, GST and STT etc. as applicable, separately, within 24 hours of execution of trades. | Do not opt for digital contracts, if not familiar with computers. |
| 8 | Receive funds and securities/ commodities on time, as prescribed by SEBI or exchange from time to time. | Do not share trading password. |
| 9 | Verify details of trades, contract notes and statement of account and approach relevant authority for any discrepancies. Verify trade details on the Exchange websites from the trade verification facility provided by the Exchanges. | Do not fall prey to fixed / guaranteed returns schemes. |
| 10 | Receive statement of accounts periodically. If opted for running account settlement, account has to be settled by the stock broker as per the option given by the client (Monthly or Quarterly). | Do not fall prey to fraudsters sending emails and SMSs luring to trade in stocks / securities promising huge profits. |
| 11 | In case of any grievances, approach stock broker or Stock Exchange or SEBI for getting the same resolved within prescribed timelines. | Do not follow herd mentality for investments. Seek expert and professional advice for your investments. |
| 12 | Retain documents for trading activity as it helps in resolving disputes, if they arise. |
7) Grievance Redressal Mechanism
1
Investor Complaint/ Grievances
Investor can lodge complaint/grievance against stock broker in the following ways:
Mode of filing the complaint with stock broker
Investor can approach the Stock Broker at the designated Investor Grievance e-mail ID of the stockbroker. The Stock Broker will strive to redress the grievance immediately, but not later than 21 days of the receipt of the grievance.
Mode of filing the complaint with stock exchanges
- (i) SCORES 2.0 (a web based centralized grievance redressal system of SEBI)
[https://scores.sebi.gov.in]Two level review for complaint/grievance against stock broker:
• First review done by Designated body/Exchange.
• Second review done by SEBI.
- (ii) Emails to designated email IDs of Exchange.
2
Online Dispute Resolution (ODR) platform for online Conciliation and Arbitration
If the Investor is not satisfied with the resolution provided by the Market Participants, then the Investor has the option to file the complaint/ grievance on SMARTODR platform for its resolution Through online conciliation or arbitration.
3
Steps to be followed in ODR for Review, Conciliation and Arbitration
- Investor to approach Market Participant for redressal of complaint.
- If investor is not satisfied with response of Market Participant, he/she has either of the following 2 options:
- i. May escalate the complaint on SEBI SCORES portal.
- ii. May also file a complaint on SMARTODR portal for its resolution through online conciliation and arbitration.
- Upon receipt of complaint on SMARTODR portal, the relevant MII will review the matter and endeavor to resolve the matter between the Market Participant and investor within 21 days.
- If the matter could not be amicably resolved, then the matter shall be referred for conciliation.
- During the conciliation process, the conciliator will endeavor for amicable settlement of the dispute within 21 days, which may be extended with 10 days by the conciliator with consent of the parties to dispute.
- If the conciliation is unsuccessful, then the investor may request to refer the matter for arbitration.
- The arbitration process to be concluded by arbitrator(s) within 30 days, which is extendable by 30 days with consent of the parties to dispute.
8) Handling of Investor’s claims / complaints in case of default of a Trading Member / Clearing Member (TM/CM)
Default of TM/CM
Following steps are carried out by Stock Exchange for benefit of investor, in case stock broker defaults:
- Circular is issued to inform about declaration of Stock Broker as Defaulter.
- Public Notice is issued informing declaration of a stock broker as defaulter and inviting claims within specified period.
- Information of defaulter stock broker is disseminated on Stock Exchange website.
- Intimation to clients of defaulter stock brokers via emails and SMS for facilitating lodging of claims within the specified period.
Following information is available on Stock Exchange website for information of investors:
- Norms for eligibility of claims for compensation from IPF.
- FAQ on processing of investors’ claims against Defaulter stock broker.
- Standard Operating Procedure (SOP) for handling of Claims of Investors in the Cases of Default by Brokers.
- List of Defaulter/Expelled members and public notice issued.
- Claim form for lodging claim against defaulter stock broker.
- Provision to check online status of client’s claim.
- Claim processing policy against Defaulter/Expelled members.
(1) Vision
Towards making Indian Securities Market – Transparent, Efficient, & Investor friendly by providing safe, reliable, transparent and trusted record keeping platform for investors to hold and transfer securities in dematerialized form.
(2) Mission
- To hold securities of investors in dematerialised form and facilitate its transfer, while ensuring safekeeping of securities and protecting interest of investors.
- To provide timely and accurate information to investors with regard to their holding and transfer of securities held by them.
- To provide the highest standards of investor education, investor awareness and timely services so as to enhance Investor Protection and create awareness about Investor Rights.
3) Details of business transacted by the Depository and Depository Participant (DP)
A Depository is an organization which holds securities of investors in electronic form. Depositories provide services to various market participants – Exchanges, Clearing Corporations, Depository Participants (DPs), Issuers and Investors in both primary as well as secondary markets. The depository carries out its activities through its agents which are known as Depository Participants (DP). Details available on the link https://nsdl.co.in/dpsch.php
4) Description of services provided by the Depository through Depository Participants (DP) to investors
| Sl.No | Brief about the Activity / Service | Expected Timelines for processing by the DP after receipt of proper documents |
|---|---|---|
| 1 | Dematerialization of securities | 7 days |
| 2 | Rematerialization of securities | 7 Days |
| 3 | Mutual Fund Conversion | 5 Days |
| 4 | Re-conversion of Mutual fund units | 7 days |
| 5 | Transmission of securities | 7 days |
| 6 | Registering pledge request | 15 days |
| 7 | Closure of demat account | 30 days |
| 8 | Settlement Instruction | For T+1 day settlements, Participants shall accept instructions from the Clients, in physical form up to 4 p.m. (in case of electronic instructions up to 6.00 p.m.) on T day for pay-in of securities. For T+0 day settlements, Participants shall accept EPI instructions from the clients, till 11:00 AM on T day. Note: ‘T’ refers ‘Trade Day’ |
(2) Depositories provide special services like pledge, hypothecation, internet based services etc. in addition to their core services and these include
| Sl.No | Type of Activity/Service | Brief about the Activity / Service |
|---|---|---|
| 1 | Value Added Services | Depositories also provide value added services such as
(1) Basic Services Demat Account (BSDA) (2) Transposition cum dematerialization (3) Linkages with Clearing System (4) Distribution of cash and non-cash corporate benefits (Bonus, Rights, IPOs etc.), stock lending, demat of NSC / KVP, demat of warehouse receipts etc. |
| 2 | Consolidated Account statement (CAS) | CAS is issued within 10 days from the end of the month (if there were transactions in the previous month) or half yearly (if no transactions). |
| 3 | Digitalization of services provided by the depositories | Depositories offer below technology solutions and e-facilities to their demat account holders through DPs:
a. E-account opening b. Online instructions for execution c. e-DIS / Demat Gateway d. e-CAS facility e. Miscellaneous services |
5) Details of Grievance Redressal Mechanism
(1) The Process of investor grievance redressal
1
Investor Complaint/ Grievances
Investor can lodge complaint/ grievance against the Depository/DP in the following ways:
A. Electronic mode
- SCORES (a web based centralized grievance redressal system of SEBI) [https://scores.sebi.gov.in]
Two Level Review for complaint/grievance against DP:
• First review done by Designated Body
• Second review done by SEBI
- (ii) Respective Depository’s web portal dedicated for the filing of compliant [https://nsdl.co.in/nsdlnews/investors.php]
- (iii) Emails to designated email IDs of Depository [relations@nsdl.com]
2
Online Dispute Resolution (ODR) platform for online Conciliation and Arbitration
- If the Investor is not satisfied with the resolution provided by DP or other Market Participants, then the Investor has the option to file the complaint/ grievance on SMARTODR platform for its resolution through by online conciliation or arbitration. [https://smartodr.in/register]
3
Steps to be followed in ODR for Review, Conciliation and Arbitration
- Investor to approach Market Participant for redressal of complaint
- If investor is not satisfied with response of Market Participant, he/she can escalate the complaint on SEBI SCORES portal.
- Alternatively, the investor may also file a complaint on SMARTODR portal for its resolution through online conciliation and arbitration.
- If the matter could not be amicably resolved, then the Investor may request the MII to refer the matter case for conciliation.
- During the conciliation process, the conciliator will endeavor for amicable settlement of the dispute within 21 days, which may be extended with 10 days by the conciliator.
- If the conciliation is unsuccessful, then the investor may request to refer the matter for arbitration.
The arbitration process to be concluded by arbitrator(s) within 30 days, which is extendable by 30 days.
(2) Illustration of New Grievance Redressal System:
6) Guidance pertaining to special circumstances related to market activities: Termination of the Depository Participant
| Sl.No | Type of special circumstances | Timelines for the Activity/ Service |
|---|---|---|
| 1 | Depositories to terminate the participation in case a participant no longer meets the eligibility criteria and/or any other grounds as mentioned in the bye laws like suspension of trading member by the Stock Exchanges.
Participant surrenders the participation by its own wish. | Client will have a right to transfer all its securities to any other Participant of its choice without any charges for the transfer within 30 days from the date of intimation by way of letter/email. |
(7) Dos and Don’ts for Investor
| Sr.No | Guidance |
|---|---|
| i | Always deal with a SEBI registered Depository Participant for opening a demat account. |
| ii | Read all the documents carefully before signing them. |
| iii | Before granting Power of attorney to operate your demat account to an intermediary like Stock Broker, Portfolio Management Services (PMS) etc., carefully examine the scope and implications of powers being granted. |
| iv | Always make payments to registered intermediary using banking channels. No payment should be made in name of employee of intermediary. |
| v |
Accept the Delivery Instruction Slip (DIS) book from your DP only (pre-printed with a serial number along with your Client ID) and keep it in safe custody and do not sign or issue blank or partially filled DIS slips. Always mention the details like ISIN, number of securities accurately. In case of any queries, please contact your DP or broker and it should be signed by all demat account holders. Strike out any blank space on the slip and Cancellations or corrections on the DIS should be initialed or signed by all the account holder(s). Do not leave your instruction slip book with anyone else. Do not sign blank DIS as it is equivalent to a bearer cheque. |
| vi | Inform any change in your Personal Information (for example address or Bank Account details, email ID, Mobile number) linked to your demat account in the prescribed format and obtain confirmation of updation in system |
| vii | Mention your Mobile Number and email ID in account opening form to receive SMS alerts and regular updates directly from depository. |
| viii | Always ensure that the mobile number and email ID linked to your demat account are the same as provided at the time of account opening/updation. |
| ix | Do not share password of your online trading and demat account with anyone. |
| x | Do not share One Time Password (OTP) received from banks, brokers, etc. These are meant to be used by you only. |
| xi | Do not share login credentials of e-facilities provided by the depositories such as e-DIS/demat gateway, SPEED-e/easiest etc. with anyone else. |
| xii | Demat is mandatory for any transfer of securities of Listed public limited companies. |
| xiii | If you have any grievance in respect of your demat account, please write to designated email IDs of depositories or you may lodge the same with SEBI online at https://scores.sebi.gov.in |
| xiv | Keep a record of documents signed, DIS issued and account statements received. |
| xv | As Investors you are required to verify the transaction statement carefully for all debits and credits in your account. In case of any unauthorized debit or credit, inform the DP or your respective Depository. |
| Appoint a nominee to facilitate your heirs in obtaining the securities in your demat account, on completion of the necessary procedures | |
| xvii | Register for Depository’s internet based facility or download mobile app of the depository to monitor your holdings. |
| xviii | Ensure that, both, your holding and transaction statements are received periodically as instructed to your DP. You are entitled to receive a transaction statement every month if you have any transactions. |
| xix | Do not follow herd mentality for investments. Seek expert and professional advice for your investments |
| xx | Beware of assured/fixed returns. |
(8) Rights of investors
| i | Receive a copy of KYC, copy of account opening documents |
| ii | No minimum balance is required to be maintained in a demat account. |
| iii | No charges are payable for opening of demat accounts. |
| iv | If executed, receive a copy of Power of Attorney. However, Power of Attorney is not a mandatory requirement as per SEBI / Stock Exchanges. You have the right to revoke any authorization given at any time. |
| v | You can open more than one demat account in the same name with single DP/ multiple DPs |
| vi | Receive statement of accounts periodically. In case of any discrepancies in statements, take up the same with the DP immediately. If the DP does not respond, take up the matter with the Depositories. |
| vii | Pledge and /or any other interest or encumbrance can be created on demat holdings. |
| viii | Right to give standing instructions with regard to the crediting of securities in demat account. |
| ix | Investor can exercise its right to freeze/defreeze his/her demat account or specific securities / specific quantity of securities in the account, maintained with the DP. |
| x | In case of any grievances, Investor has right to approach Participant or Depository or SEBI for getting the same resolved within prescribed timelines. |
| xi | Every eligible investor shareholder has a right to cast its vote on various resolutions proposed by the companies for which Depositories have developed an internet based ‘e-Voting’ platform. |
| xii | Receive information about charges and fees. Any charges/tariff agreed upon shall not increase unless a notice in writing of not less than thirty days is given to the Investor. |
| xiii | Right to indemnification for any loss caused due to the negligence of the Depository or the participant. |
| xiv | Right to opt out of the Depository system in respect of any security. |
(9) Responsibilities of Investors
| i | Deal with a SEBI registered DP for opening demat account, KYC and Depository activities. |
| ii | Provide complete documents for account opening and KYC (Know Your Client). Fill all the required details in Account Opening Form / KYC form in own handwriting and cancel out the blanks. |
| iii | Read all documents and conditions being agreed before signing the account opening form. |
| iv | Accept the Delivery Instruction Slip (DIS) book from DP only (preprinted with a serial number along with client ID) and keep it in safe custody and do not sign or issue blank or partially filled DIS. |
| v | Always mention the details like ISIN, number of securities accurately. |
| vi | Inform any change in information linked to demat account and obtain confirmation of updation in the system. |
| vii | Regularly verify balances and demat statement and reconcile with trades / transactions. |
| viii | Appoint nominee(s) to facilitate heirs in obtaining the securities in their demat account. |
| ix | ix. Do not fall prey to fraudsters sending emails and SMSs luring to trade in stocks / securities promising huge profits. |
(10) Code of Conduct for Depositories
Code of Conduct for Depositories (Part D of Third Schedule of SEBI (D & P) Regulations, 2018)
Depository shall:
| (a) | Always abide by the provisions of the SEBI Act, 1992 Depositories Act, 1996, any Rules or Regulations framed thereunder, circulars, guidelines and any other directions issued by the Board from time to time. |
| (b) | Adopt appropriate due diligence measures. |
| (c) | Take effective measures to ensure implementation of proper risk management framework and good governance practices. |
| (d) | Take appropriate measures towards investor protection and education of investors. |
| (e) | Treat all its applicants/members in a fair and transparent manner. |
| (f) | Promptly inform SEBI of violations of the provisions of the SEBI Act, 1992 the Depositories Act, 1996, rules, regulations, circulars, guidelines or any other directions by any of its issuer or issuer’s agent. |
| (g) | Take a proactive and responsible attitude towards safeguarding the interests of investors, integrity of depository’s systems and the securities market. |
| (h) | Endeavor for introduction of best business practices amongst itself and its members. |
| (i) | act in utmost good faith and shall avoid conflict of interest in the conduct of its functions. |
| (j) | not indulge in unfair competition, which is likely to harm the interests of any other Depository, their participants or investors or is likely to place them in a disadvantageous position while competing for or executing any assignment. |
| (j) |
(k) segregate roles and responsibilities of key management personnel within the depository including
|
| (l) | be responsible for the acts or omissions of its employees in respect of the conduct of its business. |
| (m) | monitor the compliance of the rules and regulations by the participants and shall further ensure that their conduct is in a manner that will safeguard the interest of investors and the securities market. |
(11) Code of Conduct for Participants
Code of Conduct for Participants (Part A of Third Schedule of SEBI (D & P) Regulations, 2018)
| (1) | A participant shall make all efforts to protect the interests of investors. |
| (2) |
A participant shall always endeavour to—
|
| (3) | A participant shall maintain high standards of integrity in all its dealings with its clients and other intermediaries, in the conduct of its business. |
| (4) |
A participant shall be prompt and diligent in opening of a beneficial owner account, dispatch of the dematerialisation request form, rematerialisation
request form and execution of debit instruction slip and in all the other activities undertaken by him on behalf of the beneficial owners. |
| (5) | A participant shall endeavour to resolve all the complaints against it or in respect of the activities carried out by it as quickly as possible, and not later than one month of receipt. |
| (6) | A participant shall not increase charges/fees for the services rendered without proper advance notice to the beneficial owners. |
| (7) | 7. A participant shall not indulge in any unfair competition, which is likely to harm the interests of other participants or investors or is likely to place such other participants in a disadvantageous position while competing for or executing any assignment. |
| (8) | A participant shall not make any exaggerated statement whether oral or written to the clients either about its qualifications or capability to render certain services or about its achievements in regard to services rendered to other clients. |
| (9) | A participant shall not divulge to other clients, press or any other person any information about its clients which has come to its knowledge except with the approval/authorisation of the clients or when it is required to disclose the information under the requirements of any Act, Rules or Regulations. |
| (10) | A participant shall co-operate with SEBI as and when required. |
| (11) | A participant shall maintain the required level of knowledge and competency and abide by the provisions of the Act, Rules, Regulations and circulars and directions issued by the Board. The participant shall also comply with the award of the Ombudsman passed under the Securities and Exchange Board of India (Ombudsman) Regulations, 2003. |
| (12) | A participant shall not make any untrue statement or suppress any material fact in any documents, reports, papers or information furnished to SEBI. |
| (13) | A participant shall not neglect or fail or refuse to submit to SEBI or other agencies with which it is registered, such books, documents, correspondence, and papers or any part thereof as may be demanded/requested from time to time. |
| (14) | A participant shall ensure that SEBI is promptly informed about any action, legal proceedings, etc., initiated against it in respect of material breach or non- compliance by it, of any law, Rules, regulations, directions of the Board or of any other regulatory body. |
| (15) | A participant shall maintain proper inward system for all types of mail received in all forms. |
| (16) | A participant shall follow the maker—checker concept in all of its activities to ensure the accuracy of the data and as a mechanism to check unauthorised transaction. |
| (17) |
A participant shall take adequate and necessary steps to ensure that continuity in data and record keeping is maintained and that the data or records are not lost or destroyed. It shall also ensure that for electronic records and data, up- to- date back up is always available with it. |
| (18) | A participant shall provide adequate freedom and powers to its compliance officer for the effective discharge of his duties. |
| (19) | A participant shall ensure that it has satisfactory internal control procedures in place as well as adequate financial and operational capabilities which can be reasonably expected to take care of any losses arising due to theft, fraud and other dishonest acts, professional misconduct or omissions. |
| (20) | A participant shall be responsible for the acts or omissions of its employees and agents in respect of the conduct of its business. |
| (21) | A participant shall ensure that the senior management, particularly decision makers have access to all relevant information about the business on a timely basis. |
| (22) | A participant shall ensure that good corporate policies and corporate governance are in place. |
Following information is available on Stock Exchange website for information of investors:
