SEBI Extends Deadline for Pledge-Repledge Margin Framework to October 10, 2025

The Securities and Exchange Board of India (SEBI) has extended the deadline for implementing the revised framework concerning margin obligations through the pledge and re-pledge mechanism within the depository system. Originally set to take effect on September 1, 2025, the new implementation date is now October 10, 2025.

The extension follows formal requests from depositories—Central Depository Services Ltd (CDSL) and National Securities Depository Ltd (NSDL)—who sought additional time to complete system enhancements and conduct comprehensive end-to-end testing to ensure operational readiness.

"In consideration of these representations and to facilitate a seamless rollout without disruption to market participants and investors, SEBI has decided to revise the implementation timeline to October 10, 2025," the regulator stated in its circular.

Scope of New Framework

Under the new framework, SEBI aims to enhance transparency and safeguard client securities by introducing a mechanism were, upon invocation, client securities will be blocked for early pay-in directly within the client’s demat account. This is expected to significantly reduce the risk of misuse of client securities by brokers and provide a clear audit trail for every transaction.

Additionally, SEBI is introducing a streamlined process termed "pledge release for pay-in", where a single instruction will simultaneously release the existing pledge and establish a pay-in block within the client's demat account.

To support this initiative, depositories will be required to implement the necessary system functionalities that comply with the updated regulations.

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

Once operational, the need for separate physical or electronic instructions for un-pledging and delivery will be eliminated. The system will automatically validate and process the pay-in up to the extent of the client’s obligations, thereby increasing efficiency and reducing operational risk.

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