Regulatory changes to Client Unpaid Securities Pledgee Account (CUSPA)
We would like to bring to your attention the changes that will be in force regarding clients’ unpaid securities in accordance with a SEBI circular. Starting from 01-Apr-2023, unpaid securities belonging to clients will be auto-pledged in the client’s demat account. The securities that have not been paid in full by the client shall be transferred to the respective client’s demat account, followed by the creation of an auto-pledge without any specific instruction from the client.
Let’s understand this with an example:
If a client has purchased shares on a Monday (Trade day) and if Tuesday is the Settlement date, either one of the two things can happen on Tuesday:
a. If the Net Available Balance is Credit, then the payout will be released in the client’s account.
b. If the Net Available Balance is Debit, then the equivalent quantity will be auto-pledged.
Note: If the outstanding dues are not cleared within Trade + 5 days, then Angel One will liquidate the shares as per RMS policy.
The following changes will occur due to this new process:
Refer: SEBI Circular