Everybody read this Article published on 'The Economic Times' on 24th Sept. 2009.
NSE cuts charges further for rural, semi-urban traders
MUMBAI: The National Stock Exchange (NSE) on Wednesday announced a further reduction in transaction charges for trading members having operations in semi-urban and rural areas. The exchange, which recently reduced transaction charges by about 10% in the cash and futures segment, has decided to waive transaction charges equivalent to the annual Very Small Aperture Terminal (VSAT) charges levied by the exchange. Currently, annual VSAT charges stand at Rs 1 lakh. NSE VSATs around 2900 are those provided by the exchange.
The latest waiver means that on a transaction charge of Rs 3 per lakh (effective October 1, 2009) of the traded value in the cash market segment, a trading member will get an exemption of up to Rs 333-crore turnover annually. Similarly, on a transaction charge of Rs 1.75 per lakh (effective October 1, 2009) of the traded value in the F&O segment, a trading member will get a waiver of up to Rs 571 crore of the annual turnover.
The move is expected to benefit small and medium size brokers who have presence in rural areas or are setting up offices there. Many small brokers in smaller towns do less than Rs 1-crore turnover per day. So effectively, this means that they wont be charged a transaction fee by the exchange. This benefit will also be passed on to retail investors, said an Ahmedabad-based broker.
NSE VSATs are located or likely to be located in towns other than the municipal limits of Mumbai (including Thane and Navi Mumbai), New Delhi (including NOIDA and Gurgaon), Kolkata, Chennai, Ahmedabad, Hyderabad (including Secunderabad) and Bangalore will be considered eligible.
NSE has provided the VSAT and point of presence (PoP) infrastructure at reduced cost to members. The PoP infrastructure reduces the cost to members, gives increased bandwitdth, facilitates faster market update and enables high availability through redundancy. To cater to members located in smaller regions, NSE is also providing mini PoP also.