The Securities and Exchange Board of India (SEBI) on June 18, 2026, issued a Consultation Paper on “Review of Margin Trading Facility (MTF) Framework”.
The following has been stated:-
•SEBI has issued a consultation paper proposing several changes to strengthen and streamline the Margin Trading Facility (MTF) framework.
•Key proposals include allowing brokers to raise funds through Non-Convertible Debentures (NCDs), increasing the minimum net-worth requirement for brokers offering MTF from ₹3 crore to ₹5 crore, and permitting LLP brokers to provide MTF services.
•The paper also introduces provisions for rebalancing when securities move out of eligible categories, treating certain client exposure breaches as passive breaches, and allowing fungibility between MTF and non-MTF accounts.
•SEBI proposes a uniform Rights and Obligations document across exchanges and revised disclosure and reporting requirements for brokers.
•Public comments on the proposed changes have been invited until July 09, 2026.
The detailed notification is given in the document below.
