SEBI Extends Deadline for New Margin Pledge System to October 10, 2025

The Securities and Exchange Board of India (SEBI) has extended the deadline to implement a new margin pledge and re-pledge system. The rule was earlier set to start from September 1, 2025, but now it will come into effect from October 10, 2025.

This decision came after requests from the two main depositories (CDSL and NSDL) who asked for more time to upgrade their systems and run full testing before launching the new process.

What is the New Margin Pledge System?

In the stock market, investors often use their shares as margin (a kind of security deposit) when trading. These shares are held in their demat account.

Currently, brokers can pledge these shares on behalf of the clients, but there is a risk of misuse. SEBI’s new system aims to reduce this risk.

With the new rule:

• The shares will stay in the investor’s demat account.
• Instead of transferring them, they will simply be blocked for use.
• This makes sure brokers can't misuse the shares.

SEBI is Launching a New Feature: ‘Pledge Release for Pay-In’

SEBI is also introducing a feature called ‘pledge release for pay-in’. This means:

• When a trade is completed, the system will automatically release the pledge and block the shares for delivery.
• There will be no need for brokers to give extra instructions.
• This will make the process faster and reduce errors.

Why Does the New Margin Pledge System Matter?

This change is important for making stock trading. It gives investors better control over their own securities and creates a clear record of all actions taken. Put simply, it is:

• Safer for investors
• More transparent
• Makes investors less dependent on broker actions

Read more: SEBI Proposes Relaxation in IPO and MPS Rules for Large Issuers.

Conclusion

SEBI’s move to extend the deadline gives depositories more time to prepare. Once implemented, this system will bring more trust and safety to the stock market. It’s a step forward in protecting investors and improving the way margins are handled in demat accounts.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.