Direct payout to demat SEBI rule

Wed, 20 May 2026 00:00:00 +0000

The direct payout to demat rule is a 2024 SEBI framework that requires equity sale proceeds and share credits to flow directly from the clearing corporation to the client’s demat account , bypassing the broker’s intermediate pool account. The rule, effective October 2024, was introduced to reduce systemic risk and the misuse of client funds by brokers.

The rule

Before October 2024: When a client sold equity, the proceeds first credited to the broker’s pool account at the clearing corporation, then the broker transferred them to the client’s trading account, from which the client could withdraw or use for further trades. This created a temporary commingled holding of client funds at the broker.

Direct Payout on WebNotes

Direct payout to demat SEBI rule

The rule