Muhammad Asad Tahir Bhawana

The Securities and Exchange Commission of Pakistan (SECP) has amended the Pakistan Stock Exchange (PSX) rulebook regulatory framework in order to facilitate investors to get an easy access to online brokers, reports WealthPK. The SECP is strongly committed to promoting modernization in the securities market and safeguarding investors. The announcement of an online investment platform, in response to rising demand, is a significant step towards achieving high investment goals.

This new strategy will help customers register themselves through the online source and online-only brokers will deliver trading services to customers. Online-only brokers will be classified as a subset within the Trading Only Broker category. The responsibilities for custody and clearing services would be assumed by professional clearing members, leading to a notable reduction in compliance and operational obligations.

This streamlined approach empowers brokers to focus on their fundamental expertise in delivering brokerage services and facilitating distribution. Such an arrangement will facilitate aspiring entrepreneurs in entering the brokerage industry with reduced initial and ongoing expenses. Moreover, this novel classification is poised to appeal to a fresh influx of investors in the capital market, offering enhanced convenience in managing investments through online channels.

The introduction of this new category will also generate interest among prospective investors in the capital market, as it presents enhanced convenience in managing investments through online platforms. The framework incorporates a net worth criterion of Rs7.5 million, allowing single-member companies to apply. The SECP has also formally communicated the fees for issuing and renewing licenses for Online Only Brokers, which stand at PKR50,000 and PKR25,000 respectively.

Additionally, the established brokers have the option to transition to this new category, thereby reducing operational expenses and enabling a stronger emphasis on primary trading activities. The introduction of Online Only Brokers is expected to bring about a significant transformation in the process of securities trading, offering enhanced convenience and accessibility to investors.

By eliminating the need for investors to make phone calls or visit physical offices to execute trades, this new platform aims to overcome the inconvenience and time-consuming aspects often associated with the traditional methods. The SECP actively promotes and encourages entrepreneurs and individuals to embark on the brokerage business within the Online Only Broker framework. To obtain comprehensive details regarding the Online Only Broker license and the application procedures, interested individuals may visit www.psx.com.pk.

Credit: Independent News Pakistan-WealthPk