The Securities and Exchange Board of India (SEBI) issued a circular on 22 October 2026 introducing a margin waiver for subsequent buy or sell transactions in the cash segment where a client has a net sell obligation and the clearing corporation has accepted an early pay-in (EPI) request for the sold securities. The waiver operates at the clearing-corporation level: the clearing corporation will not collect margin from the trading member or clearing member for the client’s subsequent positions up to the eligible EPI value.
On the trade date, the clearing corporation must determine the available EPI value as the lower of the value of securities delivered through EPI and the value of the securities sold. For subsequent cash-segment trades, it must assess client margin availability after taking account of that amount. The relaxation is not an unconditional waiver of clients’ risk-management or margin obligations. Trading members must permit further positions or square-off transactions only where the requisite client margin is available.
If a client squares off the sale of securities for which the EPI benefit was used, the available EPI value is withdrawn. Any resulting client-level margin shortfall must be blocked against the trading or clearing member’s proprietary collateral. This particular provision does not apply to trade-for-trade securities, which are settled on a gross basis.
Recognised clearing corporations are required to amend relevant rules and procedures where needed, implement supporting system changes and publish the circular’s provisions on their websites. The framework comes into force four months after the circular’s 22 October 2026 issuance date, namely 22 February 2027.
For brokers and clearing participants, the key operational requirement is real-time tracking of accepted EPI, eligible value and subsequent positions, together with controls that reinstate margin requirements when the EPI benefit ceases. Investors may benefit from reduced duplicate margin blocking, subject to the prescribed checks and their broker’s risk controls.