ENAn important step to receiving Margin Trading Facility (MTF) is completing the Pledge Request. It is important to complete the Pledge Request to avoid square-off. Let’s learn what MTF Pledge is and how to process it.
What is MTF Pledge?
It is a mandatory process introduced by SEBI. When you buy shares under MTF, you have to pledge those shares to continue holding the position. It needs to be done by 9:00 PM on the same day of purchasing stock. In case you fail to do so, your shares will be squared-off on T+7 days.
MTF Pledge Process
Here’s how you can complete your MTF Pledge Process:
- Once your MTF request is approved, check your Email/SMS for communications related to the MTF Pledge Request Initiation
- Click the CDSL link in the Email/SMS to get redirected to CDSL’s website
- Enter PAN/Demat Account Details
- Select Stocks to Pledge
- Generate OTP
- Enter received OTP to Authorize and complete the Process
With MTF Pledging, when you raise a request to Pledge or Unpledge your shares, a charge of Rs 20/- plus GST will apply per Scrip. Also when there is sell off/square-off, you’ll also incur Unpledge charges automatically if you have pledged your shares.
So that’s it! Margin Trading Facility can transform the way you trade. Just remember a few critical details, and follow the procedure to enjoy this unique facility. Happy Trading!