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Mumbai, May 28 Stock trading using the mobile phone is likely to get a push, with SEBI issuing on Thursday a draft framework for securities trading using wireless technology. SEBI said it is exploring, through these guidelines, the possibility of extending the existing framework for Internet trading to enable use of wireless technology for securities trading. The guidelines for Internet-based trading were put in place by SEBI in January 2000.
Mumbai, May 28 Stock trading using the mobile phone is likely to get a push, with SEBI issuing on Thursday a draft framework for securities trading using wireless technology. SEBI said it is exploring, through these guidelines, the possibility of extending the existing framework for Internet trading to enable use of wireless technology for securities trading. The guidelines for Internet-based trading were put in place by SEBI in January 2000.
Quite a few brokers are already providing Web sites with low bandwidth to enable GPRS-based mobile phone users to access their Internet-based online trading platform.
According to SEBI’s proposed framework, brokers who provide Internet-based trading services are eligible to use wireless technology for the same. This would be subject to the broker/member providing this facility to obtain approval from the stock exchanges. The networth requirement of the broker is fixed at a minimum of Rs 50 lakh if the broker is providing Internet trading facility on his own. In case a service provider provides the Internet trading facility on behalf of a group of brokers, then the networth criteria as stipulated by the stock exchange will apply.
Security
The guidelines lay a lot of emphasis on user identification, network access control and network security, requiring brokers to maintain adequate back up systems and data storage capacity. SEBI has invited comments from market participants latest by June 15.
The guidelines lay a lot of emphasis on user identification, network access control and network security, requiring brokers to maintain adequate back up systems and data storage capacity. SEBI has invited comments from market participants latest by June 15.
Securities trading through mobile phones is so far at a nascent stage. Reliance Money, which started this facility recently, records an average 3000 such trades a day, an official of the company said.
“A whole lot of people generally trade in the markets through brokers since they do not have access to online trading. Since mobile phone penetration in the country is many times higher than broadband connectivity, many of them will now be able to use their cell phones for trading,” Mr Sourabh Kaushal, Principal Consultant with advisory firm BDA Connect (India), said.
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