Glossary

This is the universal glossary. Every acronym referenced anywhere on this site links here. Entries are alphabetical, with a category-grouped table of contents immediately below for browsing by topic.

Where this fits. This is the Glossary — vocabulary reference. For the regulatory base behind the terms see Regulatory Circulars; for where each defined field flows across destinations see Field-level Data Flow Atlas; for the operator’s mental model see Broker Process Narrative; for role-curated reading paths see Choose Your Role.

Browse by category

The same entries appear once below in alphabetical order. This grouping is a navigation aid only.

Regulators & statutory bodies — SEBI, RBI, NPCI, CERSAI, MeitY, CCA, FIU-IND, FATF, IRDA, PFRDA, FMC, SRO, MII

Exchanges & depositories — NSE, BSE, MCX, NCDEX, ICEX, MSEI, CDSL, NSDL, NCL (NSCCL), ICCL, MCXCCL

Identity, KYC & e-signing — PAN, e-PAN, Aadhaar (UID), CKYC, KRA, eKYC, IPV, VIPV, OTP, KIN, OVD, DigiLocker, eSign, Aadhaar Offline XML (Paperless KYC), e-KYC Setu

Cross-border / tax / NRI — FATCA, CRS, TIN, GIIN, NRI, NRE, NRO, PIS, RNOR, FEMA, FCNR

Compliance & AML — PMLA, AML, CFT, PEP, STR, CTR, NTR, FIU, SCORES, IGRC, ODR, DPDP

Member / account types & roles — UCC, BO (Beneficial Owner), BO (Branch Office), DP, AP, KMP, CM, TM, QSB, RA, IA, PMS

Trading systems & FIX — OMS, EMS, RMS, FIX, SOR, SPAN, ELM, MTM, VAR margin

Trading concepts — BOD, EOD, IST, T+0, T+1, T+2, MWPL, ASBA, IPO, OFS, MTF, SLBM, GSM, ASM, ESM, Peak margin, Running account settlement, Pre-open session, Closing auction, Block deal vs Bulk deal, Call auction, Periodic call auction

Settlement & risk infrastructure — SGF, Core SGF, IPF, CCP, Upstreaming of client funds, Direct payout to demat, Pay-in and Pay-out, Auction settlement, Short delivery, COD

Regulatory frameworks — CSCRF, BCP and DR, System audit, Concurrent audit, Internal audit, Statutory audit, Inspection Type I, II, III, AP framework, TRAI DLT

Payment & banking rails — UPI, UPI AutoPay, IMPS, NEFT, RTGS, ECS, NACH, AA (Account Aggregator), e-Mandate, Penny drop, AePS

Member compliance & corporate — BMC, ABC, Net worth requirement, Fit and proper, KYP, HUF, Family company, Partnership, LLP, Corporate broker, BRSR

Misc broking concepts — DDPI, POA, Nomination, Transmission, Dormancy, Re-KYC, Modification request, NRI conversion, Closure, 2FA, Maker-checker

SEBI internal department codes — MIRSD, MRD, IMD, OIAE, LAD-NRO, CFD, SEC-FATF, HO, ITD

All entries (alphabetical)

2FA

Full form: Two-Factor Authentication Meaning: A login or authorization mechanism requiring two independent factors — typically something the user knows (password / PIN) and something the user has (OTP delivered to registered mobile / email, biometric, hardware token). SEBI mandates 2FA for trading-platform login by retail clients and for order placement on internet-based trading. Common implementations on broker platforms include password + SMS OTP, password + TOTP app (Google Authenticator), and biometric on mobile apps. The 2025 SEBI cybersecurity clarifications extend 2FA expectations to all critical operational logins (RMS, back-office admin, surveillance). See also: Maker-checker, CSCRF

AA (Account Aggregator)

Full form: Account Aggregator (RBI-licensed NBFC-AA) Meaning: An RBI-regulated entity that, with explicit consumer consent, fetches financial data (bank statements, mutual-fund holdings, tax filings, GST returns) from Financial Information Providers (FIPs) and delivers it in a standardized format to Financial Information Users (FIUs). For brokers, AA-based bank-statement pulls are a common alternative to penny-drop verification and a source of income evidence for client risk profiling. Consent is granular and revocable; data is encrypted end-to-end with the AA acting as a pure conduit. Founding circular: RBI/DNBR/2016-17/46 (Master Direction — NBFC-AA, Sep 2016) and the technical specification maintained by ReBIT / Sahamati. See also: Account Aggregator vendor page, Setu deep dive

Aadhaar (UID)

Full form: Aadhaar (Sanskrit for “foundation”); UID = Unique Identification number Meaning: A 12-digit unique identification number issued by the Unique Identification Authority of India (UIDAI), linked to biometric and demographic data of every resident. For broking KYC, Aadhaar is the most-used identity / address OVD. Full Aadhaar (12-digit number) cannot be stored in plain by most non-government entities post-2018; brokers use Aadhaar Offline XML / Paperless KYC or masked Aadhaar copies. UIDAI Act 2016 and amendments govern its use; Aadhaar-Authentication (Banking Companies, Aadhaar-enabled Services) Regulations 2019 permit Aadhaar-based eKYC for SEBI-regulated entities through Setu or licensed KUAs/sub-KUAs. See also: Aadhaar Offline XML (Paperless KYC), DigiLocker integration, Six attribute matching

Aadhaar Offline XML (Paperless KYC)

Full form: Aadhaar Paperless Offline e-KYC (XML) Meaning: UIDAI service letting the resident download a signed, share-code-encrypted XML containing their masked Aadhaar number (last 4 digits visible), name, DOB, gender, address, and photo. The broker validates the digital signature (UIDAI public key) and unlocks the XML using the share code provided by the resident. This is the standard fallback when online Aadhaar e-KYC (OTP/biometric) is not accessible to a non-KUA broker. Storage of full Aadhaar number is prohibited; the masked form is permitted under the 2020 SEBI KYC technology circular. See also: DigiLocker integration

ABC

Full form: Additional Base Capital Meaning: Capital that exchanges require a Trading Member to maintain on top of the Base Minimum Capital (BMC) when the member chooses to take exposure exceeding the entitlement supported by BMC alone. Each exchange (NSE, BSE, MCX) publishes a methodology that translates required gross / net exposure into ABC obligation; the member tops up cash, FDR, bank guarantee, or approved securities into the exchange-prescribed segregated account. Shortfall in ABC triggers proportional cuts in turnover allowed, deactivation in extreme cases, and a half-yearly compliance reporting flag. See also: BMC and ABC deep-dive

AePS

Full form: Aadhaar enabled Payment System Meaning: NPCI-operated payment system that uses Aadhaar number + biometric (fingerprint / iris) for authentication of cash withdrawal, balance inquiry, mini-statement, and fund transfer at micro-ATMs and business correspondents. AePS is rarely a primary rail for broker collections (which prefer UPI, NEFT, RTGS), but it surfaces in inclusive-finance segments and in some hybrid onboarding flows in semi-urban / rural geographies. See also: UPI, Payment mandates

AMC

Full form: Asset Management Company (mutual funds context) / Annual Maintenance Charges (depository context). Meaning: Two unrelated broking-context meanings. (1) An AMC in mutual funds = SEBI-registered Asset Management Company that manages mutual fund schemes (e.g., HDFC AMC, ICICI Prudential AMC); the broker integrates with these via direct AMC API or via platforms like MFU / BSE StAR MF. (2) An AMC in depository context = the annual fee a Depository Participant charges Beneficial Owners for maintaining the demat account (BSDA accounts have AMC waivers/concessions per CDSL/NSDL circulars). Pick the meaning from context.

AML

Full form: Anti-Money Laundering Meaning: The body of rules and operational controls a regulated entity must run to detect, deter, and report attempts to launder proceeds of crime through its platform. In Indian broking, AML obligations flow from the Prevention of Money Laundering Act 2002 (PMLA), Rules 2005, and SEBI’s master circular on AML/CFT (latest SEBI/HO/MIRSD/SECFATF/P/CIR/2024/78, 6 Jun 2024). Operational pillars: client risk categorization at onboarding (low / medium / high), enhanced due diligence (EDD) for high-risk and PEP clients, ongoing transaction monitoring, and reporting of STRs / CTRs / NTRs to FIU-IND. See also: AML / FIU field-atlas destination, PEP / AML section

AP

Full form: Authorized Person Meaning: An individual or entity registered by an exchange to act as an agent of a Trading Member, soliciting clients and executing trades on the member’s platform, but never holding client funds or securities in their own name. APs replaced the older “Sub-broker” framework in 2018 (SEBI circular SEBI/HO/MIRSD/MIRSD2/CIR/P/2018/117). Brokers must conduct fit-and-proper checks before sponsoring an AP, register them with each exchange separately, and supervise their conduct (including periodic visits per the SEBI AP framework). APs receive a share of brokerage as commercial arrangement. See also: AP framework deep dive

AP framework

Full form: Authorized Person framework Meaning: The full regulatory and operational regime governing how a broker recruits, registers, supervises, and (if needed) terminates Authorized Persons. Captures fit-and-proper, KYP (Know-Your-Promoter equivalent for the AP), bank-guarantee or security deposit, exchange registration on each segment, periodic AP-visit logs by the broker’s compliance team, AP-level grievance redressal, and exit / cessation procedure. The framework is the subject of multiple SEBI clarifications between 2018 and 2025 and is one of the heaviest inspection focus areas. See also: AP framework deep-dive

ASBA

Full form: Applications Supported by Blocked Amount Meaning: SEBI-mandated mechanism for IPO / FPO / rights-issue applications. The applicant’s bank earmarks (blocks) the application amount in their bank account; funds are debited only on allotment. The SEBI ASBA framework was extended to secondary-market UPI-based trading (block-and-trade) on optional basis from 2024. Brokers integrate with bank ASBA gateways and the exchange UPI-ASBA infrastructure for IPO bidding via their app. See also: IPO / OFS broker-side deep dive

ASM

Full form: Additional Surveillance Measure Meaning: Exchange-led surveillance mechanism placing securities under tighter risk controls when price-volume patterns suggest manipulation or abnormal volatility. ASM has two stages: Short-Term ASM (5 to 15 day cycle, intra-day) and Long-Term ASM (multi-stage with progressively tighter conditions). Effects include 100% margin, T-group trade-for-trade settlement, price band tightening, and disclosure of trade-to-trade settlement labels in the broker’s contract notes. Lists are published end-of-day by NSE and BSE; broker RMS pulls the lists at BOD to apply the next day’s restrictions. See also: Surveillance / GSM / ASM deep dive

ATR

Full form: Action Taken Report. Meaning: A structured report a broker submits in response to a regulatory observation, investor complaint, exchange inspection finding, or audit exception. ATRs document the corrective action, root cause, deadline, and ownership. SCORES complaints are closed via ATR; concurrent / system audit exceptions are tracked to ATR closure; SEBI inspection observations require ATR within stipulated timelines (typically 30 days).

Auction settlement

Full form: — Meaning: Exchange-led market mechanism that buys the deliverable shares from the open market on T+2 to cover a short delivery by a member. When a member fails to deliver on settlement day, the clearing corporation runs a special auction session next day; the auction price (plus penalty / close-out as per exchange formula) replaces the original trade price for the defaulting member’s leg. The buyer who was short-delivered receives the auction-purchased shares; the defaulting member pays the auction price minus 20% close-out cap as the worst-case settlement. See also: Short delivery / auction deep dive

BCP and DR

Full form: Business Continuity Plan and Disaster Recovery Meaning: Tested, documented, exchange-approved set of arrangements that lets a broker continue critical operations from an alternate site or in degraded mode after a disaster (fire, flood, cyber-attack, prolonged power outage). Components include geographically-diverse DR data center (with prescribed RPO and RTO targets), periodic mandatory DR drills (typically half-yearly with exchanges), documented call-tree / runbook, alternate communication channels, and post-drill reports to exchange / SEBI. CSCRF tightens BCP / DR expectations and explicitly requires a periodic table-top exercise alongside the technical drill. See also: BCP / DR drill deep dive, CSCRF

Block deal vs Bulk deal

Full form: — Meaning: Two distinct large-order regimes that the exchange treats differently.

Block deal — a single trade of minimum INR 10 crore value executed in the dedicated block-deal window (typically 08:45–09:00 IST morning window and 14:05–14:20 IST afternoon window) at a price within +/- 1% of the previous close or current ref price. Reported on the exchange block-deal disclosure feed.
Bulk deal — any trade or set of trades by a single client where total quantity in a security on a single day exceeds 0.5% of the listed/issued capital. Reported by the broker to the exchange end-of-day; published in the bulk-deal disclosure feed next morning. Both create market-disclosure obligations; brokers run automated trade-pattern detection at EOD to identify and disclose. See also: Block deals / bulk deals deep dive

BMC

Full form: Base Minimum Capital Meaning: The minimum capital a Trading Member must keep with each exchange / clearing corporation as the foundation of their risk-bearing capacity. Slab varies by segment (cash, F&O, currency, commodity) and member category (TM-only, TM+CM, professional clearing member). Typical TM cash-segment BMC is INR 10 lakh; F&O segment is INR 50 lakh; commodity (MCX) is segment-specific. Held as cash + approved securities + FDR + bank guarantee in exchange-prescribed proportions. Quarterly capital adequacy reporting reconciles BMC plus ABC against required exposure. See also: BMC and ABC deep dive

BO (Beneficial Owner)

Full form: Beneficial Owner Meaning: The natural-person ultimate owner of a demat account or, in a non-individual context, the natural person(s) who ultimately own or control more than the prescribed threshold (25% for non-financial entities, 15% for trusts under PMLA Rule 9) of the legal entity holding the account. Depositories (CDSL, NSDL) maintain a Beneficial Owner Identifier (BO-ID) — the 16-digit demat account number — that uniquely identifies the BO across the depository’s system. Non-individual onboarding includes UBO declaration and supporting documents (shareholding pattern, list of partners, trust deed). See also: CDSL BO destination, NSDL BO destination, Non-individual entities

BO (Branch Office)

Full form: Branch Office Meaning: A physical office of a broker registered with the exchange / regulator separately from the head office. Each BO needs its own registration, dealer terminals registered to it, a compliance contact, and is open to exchange inspection independently. The number of BOs is a periodic disclosure item; opening / closing a BO triggers an exchange-registration update workflow. Confusingly shares the acronym “BO” with Beneficial Owner — context usually resolves the ambiguity (a BO-ID is a depository term, a BO inspection is a member-office context). See also: Exchange registration

BOD

Full form: Beginning Of Day Meaning: The pre-market window each trading morning (typically 06:00–09:00 IST) when a broker’s systems ingest overnight files from exchanges, depositories, clearing corporations, and back-office vendors. BOD activities include: loading exchange master files (security list, lot size, price bands, GSM / ASM / ESM lists), depository BO holdings reconciliation, margin file ingestion, RMS limit refresh, pre-open session monitoring at 09:00–09:15. A failed BOD on any critical file delays start-of-trading and is itself a reportable operational incident. See also: BOD integration DAG, Broker process narrative

BRSR

Full form: Business Responsibility and Sustainability Report Meaning: SEBI-mandated annual disclosure on environmental, social, and governance (ESG) parameters required from the top 1,000 listed entities since FY22 (and stepwise extended). For broking firms in this set (publicly listed Trading Members), BRSR captures GHG emissions, water consumption, gender diversity, training spend, grievance redressal, value-chain partners’ ESG posture. The “BRSR Core” sub-set is audit-assured by an independent assessor. See also: Member compliance overview

BSE

Full form: BSE Limited (formerly Bombay Stock Exchange) Meaning: India’s older equity exchange and one of two national stock exchanges (the other being NSE). Founded 1875, demutualized 2007. Provides cash, F&O, currency, commodity (BSE entered commodity in 2018 via BSE Commodity Derivatives) segments. Clearing for BSE trades is done by Indian Clearing Corporation Limited (ICCL). BSE Star MF is the dominant mutual-fund order routing platform used by independent advisors. Circulars carry the prefix “BSE/Notice/[year]/[serial]” or segment-coded references. See also: BSE vendor page, BSE circulars

Call auction

Full form: — Meaning: A trading mechanism where orders are collected over a window and matched at a single equilibrium price computed to maximize tradeable volume (or minimize imbalance) at the close of the window — as opposed to continuous order-book matching. Used in the pre-open session (09:00–09:15 IST), the closing call (15:30–15:40 IST on participating exchanges and segments), and the periodic call auction sessions imposed on illiquid scrips. See also: Pre-open / closing auction deep dive

CC

Full form: Clearing Corporation (NCL, ICCL, MCXCCL — context-dependent). Meaning: The entity that interposes itself between buyer and seller in cleared markets, guaranteeing settlement via novation. India’s main CCs are NCL (NSE/NSE-IFSC clearing), ICCL (BSE/BSE-IFSC clearing), and MCXCCL (MCX commodities clearing). The CC manages the Settlement Guarantee Fund (SGF), runs default-management waterfalls, sets margin requirements (SPAN + ELM + Additional Margin + MTM), and receives upstreamed client funds from members under SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2023/084. See SGF and Upstreaming of client funds.

CCA

Full form: Controller of Certifying Authorities Meaning: The MeitY office that licenses Certifying Authorities (CAs) issuing Digital Signature Certificates (DSCs) under the IT Act 2000, and operates the root trust chain that ultimately validates eSign signatures. Licensed CAs (NSDL e-Gov, e-Mudhra, Sify, CDAC, Capricorn, etc.) anchor their CA certificate to the CCA root. For an eSign signature to be legally valid, the CA must be CCA-licensed and the signing flow must comply with CCA’s eSign API specification (current major version 2.1). See also: MeitY circulars, eSign

CCP

Full form: Central Counterparty Meaning: A clearing corporation that interposes itself between buyer and seller in every trade, becoming the buyer to every seller and the seller to every buyer. The CCP guarantees settlement, manages margins, and waterfall-recovers in case of member default. India’s main CCPs are NSCCL/NCL (NSE), ICCL (BSE), MCXCCL (MCX), and ICCL Commodity for BSE commodity. CCPs are qualified MIIs (Market Infrastructure Institutions) under SEBI and are subject to stringent capital, risk-management, and recovery-and-resolution rules. See also: Clearing corp circulars, Core SGF, Member default recovery

CDSL

Full form: Central Depository Services (India) Limited Meaning: One of India’s two SEBI-regulated depositories (the other is NSDL). Holds dematerialized securities (equity, debt, MF units, bonds, sovereign gold bonds, AIF/REIT/InvIT units) on behalf of investors via its network of Depository Participants (DPs). CDSL is publicly listed (NSE/BSE). BO-ID format is 16 digits where first 8 = DP-ID. CDSL provides EASI/EASIEST consolidated views, e-DIS for instructions, DDPI for one-time pledge/sale authority, and operates CKYC connectivity for the depository-side. Promoter: BSE Limited (with multiple other shareholders post-IPO). See also: CDSL vendor page, CDSL circulars, CDSL extended appendix

CERSAI

Full form: Central Registry of Securitisation Asset Reconstruction and Security Interest of India Meaning: Government-of-India company under the Ministry of Finance that operates two registries: the original mortgage-and-security-interest registry (under the SARFAESI Act 2002) and the Central KYC Records Registry (CKYCRR) under PMLA Rules. For broking, CERSAI’s CKYC arm is the one that matters — it holds the centralized CKYC database (~700 million records), assigns the 14-digit KIN, and runs the upload / download / update APIs that brokers and KRAs interact with. See also: CERSAI circulars, CKYC

CFD

Full form: Corporate Finance Department (within SEBI) Meaning: SEBI’s department that handles the disclosure / listing / issuer side of the market — ICDR Regulations, takeover code, LODR (Listing Obligations and Disclosure Requirements), buybacks, delisting. Circulars from CFD appear with the prefix SEBI/HO/CFD/.... For brokers, CFD touches operational practice through IPO/OFS process rules, disclosure formats their listed broking-firm parent must use, and takeover-window restrictions on certain client orders. See also: SEBI-other circulars

CFR

Full form: Client Funding Report. Meaning: A weekly (now daily T+1) report a broker must submit to the exchange summarising client-funding activity — margin shortfalls, broker’s own-funds usage, financing extended to clients. The CFR’s purpose is to detect over-extended brokers and protect the system; it feeds exchange surveillance and inspection planning. Submission cadence shifted from weekly (Friday) to daily-T+1 via ENIT-NEW-COMPLIANCE under NSE/INSP/55039. See also Compliance Blueprint for the full submission calendar.

CFT

Full form: Combating the Financing of Terrorism Meaning: The set of obligations a regulated entity has to detect and prevent its platform being used to fund terrorism, distinct from but operationally bundled with anti-money-laundering (AML). The Unlawful Activities (Prevention) Act 1967 (UAPA) provides the criminal anchor; PMLA and SEBI’s AML/CFT master circular operationalize CFT through sanctions-list screening (UN Consolidated List, MHA notifications), enhanced due diligence on PEP and high-risk jurisdictions, and STR filing where transactions match terrorism-financing typologies. See also: AML, FATF

CKYC

Full form: Central KYC (records registry) Meaning: A centralized, government-operated database of completed KYC records that all financial sector regulators (SEBI, RBI, IRDAI, PFRDA) plug into. Operated by CERSAI; technical specification and field schema are issued by CERSAI under PMLA Rules. Each individual or non-individual gets a 14-digit KIN (KYC Identification Number) on first registration. A broker pulls a customer’s CKYC record (saving re-collection of OVDs) or pushes a freshly KYC’d customer’s record. The dual-upload mandate (SEBI/HO/MIRSD/SECFATF/P/CIR/2024/79, 6 Jun 2024) requires both KRA AND CKYC uploads for SEBI-registered intermediaries. See also: CKYC vendor page, CKYC destination, CKYC submission section

Closing auction

Full form: — Meaning: A call-auction window (currently 15:30–15:40 IST on the participating exchange / scrip) that determines the official closing price of a security. Closing-auction price is used as the reference for benchmark constituents, derivative settlement, MTF haircut, and end-of-day mark-to-market. SEBI extended closing-call coverage progressively across 2023–2025; broker RMS systems update margin calls based on closing-auction price, not the last-traded price of the continuous session. See also: Pre-open / closing auction deep dive

Closure

Full form: — Meaning: The lifecycle event ending a client’s relationship with the broker. Includes settlement of running account balances, transfer-out of remaining securities (to a different DP or via off-market transfer to a relative’s account), cancellation of standing instructions, KRA / CKYC status update to “Closed”, removal from active client master, retention of records for the statutory period (typically 8 years post-closure under PMLA + SEBI). A closure triggers parallel closure on each exchange UCC and at the depository. See also: Lifecycle: Closure

CM

Full form: Clearing Member Meaning: A member of the clearing corporation responsible for settling trades — paying in / receiving out funds, depositing margins, and managing settlement obligations. A Trading Member (TM) can choose to be its own CM (TM+CM combined) or rely on a Professional Clearing Member (PCM). Self-clearing TMs hold larger BMC + Core SGF contributions; non-self-clearing TMs lean on the PCM but pay a clearing commission. CMs face the CCP directly and are the unit at which the default waterfall starts. See also: Clearing corp circulars, Core SGF

COD

Full form: Close-Out Debit Meaning: The cash penalty applied when a member fails to deliver securities by pay-in deadline and the exchange’s auction process cannot find sellers (or the auction price exceeds the cap). The defaulting member is charged a close-out at the higher of (auction price, last traded price on T+2) plus a percentage close-out factor — historically up to 20% above the higher of those references. The amount is debited from the member’s settlement account and paid to the buyer who was short-received. See also: Short delivery / auction deep dive

Concurrent audit

Full form: — Meaning: Ongoing audit conducted during the period under review, in contrast to retrospective annual or half-yearly audits. SEBI requires brokers to run concurrent audit of key operational areas: client funds upstreaming, margin reporting, KRA/CKYC submissions, AML alert disposition, settlement obligations. The auditor (typically a CA firm) reports findings to the broker’s compliance officer monthly and to the audit committee quarterly. Concurrent audit observations feed the half-yearly compliance certificate signed by the principal officer. See also: Concurrent audit deep dive

Core SGF

Full form: Core Settlement Guarantee Fund Meaning: The first-priority, segregated layer of the clearing corporation’s default waterfall, separate from the regular SGF. Funded by contributions from CCP itself (skin-in-the-game), clearing members, and stock exchanges in fixed proportion per SEBI’s Recovery & Resolution norms. Core SGF is tapped before the CCP’s other resources after the defaulting member’s own margins / collateral are exhausted. Size is recalibrated periodically using stress-test scenarios under SEBI’s framework for CCP risk. See also: Core SGF deep dive, Member default recovery, Pay-in default and Core SGF

CRS

Full form: Common Reporting Standard Meaning: OECD-developed automatic-exchange-of-information standard, adopted by India in 2015. Indian financial institutions (including brokers) must self-certify each client’s tax residency at onboarding, identify clients tax-resident in CRS-participating jurisdictions, and report their account balances and reportable income annually via the Income-Tax department’s reporting portal. CRS is bundled with FATCA in the same self-certification form (Form 60/61 + FATCA-CRS declaration). The CRS dataset is wider than FATCA — it covers 100+ jurisdictions, not just the US. See also: FATCA-CRS destination, FATCA-CRS section

CSCRF

Full form: Cybersecurity and Cyber Resilience Framework Meaning: SEBI’s foundational cyber framework circular SEBI/HO/ITD-1/ITD_CSC_EXT/P/CIR/2024/113 (20 Aug 2024) and its clarification chain through 2024–2025. Replaces earlier sectoral cyber circulars and applies to all SEBI-regulated entities. Built on five goals — Anticipate, Withstand, Contain, Recover, Evolve — and categorizes entities into tiers (MII / Qualified RE / Mid-size / Small / Self-Certification) based on registered clients and trade value. Operational mandates include quarterly VAPT for critical systems, six-hour CERT-In incident reporting, Type-I / II / III audit cycle, 180-day minimum log retention, supply-chain vendor due diligence, and an annual cyber-audit report submitted to the exchange. Repeated clarifications between Dec 2024 and Aug 2025 adjust audit timelines, cloud-specific guidance, and SOC requirements. See also: CSCRF deep dive

CTCL

Full form: Computer-to-Computer Link. Meaning: Legacy NSE term (still in regulatory use) for direct programmatic exchange connectivity for member-firm trading systems; encompasses what is now mostly called the FIX gateway plus dealer-terminal infrastructure. CTCL approval is governed by an NSE-specific user/dealer registration process. Distinct from algo (which is a CTCL endpoint trading algorithmically; SEBI’s retail algo framework regulates algos but algo orders flow over CTCL). See Retail algo framework.

CTR

Full form: Cash Transaction Report Meaning: Mandatory report to FIU-IND for every cash transaction (deposit, withdrawal, transfer) of INR 10 lakh or more in a single transaction, or aggregate of INR 10 lakh+ across a calendar month for related transactions. CTRs are filed by the 15th of the following month in FIU-IND’s prescribed digital format (FINGate). For brokers, CTR filings are typically small in volume since broker collections move through banking channels — but cash receipts at branches (where permitted) trigger CTR even in small amounts if cumulative. See also: STR, NTR, FIU-IND, AML / FIU destination

CUSPA

Full form: Client Unpaid Securities Pledgee Account. Meaning: A specialised demat account a broker holds with the depository to retain securities corresponding to clients who have not paid for delivery-against-payment trades (T+1 pay-in default). Replaces the older Client Unpaid Securities Account (CUSA) under SEBI/HO/MIRSD/DOP/P/CIR/2022/106 (Aug 2022). The broker can re-pledge securities from CUSPA to fund client obligations within strict regulatory bounds.

DAG

Full form: Directed Acyclic Graph. Meaning: A graph with directed edges and no cycles. Used on this site (see Integration Choreography DAG) to model broker integration dependencies: each node is an integration (e.g., “BOD margin file → RMS → pre-open file → exchange”), edges encode “must complete before”. Useful because it forces explicit dependency declaration (idempotency, retry policy, rollback, SLA, failure surface) and makes parallelisation safe.

DDPI

Full form: Demat Debit and Pledge Instruction Meaning: A one-time client-issued instrument replacing the broker-favouring Power of Attorney (POA), in force since April 2022 per SEBI circular SEBI/HO/MIRSD/DOP/P/CIR/2022/44. The DDPI authorizes the broker to debit securities from the client’s demat account for specified narrow purposes — settlement obligations, pledging margin securities, mutual-fund redemption, tendering shares in tender / OFS. DDPI is exchange-format standardized, paper-signed or eSigned, and stored both at the broker and at the depository. SEBI explicitly prohibits brokers from using DDPI to pledge securities for the broker’s own funding or to transfer client securities to broker pool. See also: DDPI section, CDSL DDPI page

DigiLocker

Full form: — Meaning: Government-of-India digital document repository (digital locker) under MeitY, operating since 2015 (and significantly expanded after 2017). Citizens authenticate with Aadhaar OTP, pull digitally-signed copies of their PAN, Aadhaar (masked XML), driving licence, passport, education certificates, and from 2024 onwards: KYC records, mutual-fund / demat holdings (per SEBI circular SEBI/HO/OIAE/OIAE_IAD-3/P/CIR/2025/32, 19 Mar 2025). For broker onboarding, DigiLocker is the cleanest OVD-fetch channel — no document forgery risk, no scan quality issues, signed XML directly from issuer. See also: DigiLocker vendor page, DigiLocker extended appendix, Journey screen 3

Direct payout to demat

Full form: — Meaning: A 2023–2024 SEBI reform requiring the clearing corporation to credit pay-out securities directly to the buyer’s demat account instead of the broker’s pool account. Eliminates the historic ambiguity around broker pool retention and prevents misuse of client securities for broker funding. Operationally requires each broker to map each client’s BO-ID to each settlement obligation; mismatches result in CC retaining the security until correctly mapped. Came into full force after staged rollouts and is now the default for cash-segment equity payouts. See also: Direct payout to demat deep dive

DLT

See TRAI DLT for SMS-pre-registration framework. Note: SEBI uses “DLT” sparingly to also refer to distributed-ledger technology in some innovation-sandbox contexts; in broking operations the dominant meaning is TRAI’s Distributed Ledger Technology framework for commercial SMS pre-registration.

Dormancy

Full form: — Meaning: A client account state entered when no trade or login activity occurs for a defined period — typically 12 months for brokerage activity and 12+ months for the depository, with each broker / depository setting its own threshold within SEBI’s outer limits. Effects: account is flagged dormant in client master, certain instructions (off-market transfer, large-value withdrawal) require additional authentication / IPV-equivalent, KRA / CKYC status may be updated to “Dormant”. A dormancy reactivation step requires a fresh declaration and IPV / VIPV equivalent before normal trading resumes. See also: Lifecycle: Dormancy reactivation

DP

Full form: Depository Participant Meaning: A SEBI-registered entity (typically a broker, bank, or NBFC) that maintains demat accounts for clients on behalf of CDSL or NSDL. The DP is the customer-facing layer; the depository is the back-end registry. Each DP has a unique 8-digit DP-ID; a client’s full demat BO-ID is DP-ID + 8-digit client code. A broker may be its own DP (combined TM+DP) or use a separate DP. Notable: the term “DP” is sometimes used informally for “Display Price” in vendor / OMS context — in this glossary and on this site, DP always means Depository Participant unless explicitly stated otherwise. See also: CDSL vendor page, NSDL vendor page

DPDP

Full form: Digital Personal Data Protection Act 2023 (and Rules 2025) Meaning: India’s first horizontal data-protection statute, enacted Aug 2023, with Rules notified in Jan 2025. Establishes the Data Protection Board, classifies entities as Data Fiduciaries (data controllers) and Data Processors, requires explicit consent for personal-data processing, mandates breach notification within 72 hours to the Board and affected principals, and grants Data Principals (individuals) rights to access, correction, and erasure. For brokers, DPDP overlays SEBI’s existing data-retention obligations — DPDP grants erasure right but SEBI / PMLA retention requirements override for the prescribed periods. Cross-references with TRAI DLT for marketing consent. See also: AA-DPDP consent section, Security and compliance

DPM

Full form: Depository Participant Module (CDSL terminology). Meaning: The DP-side application/system used by Depository Participants to interface with CDSL — account opening, transfer instructions, pledge, demat/remat, corporate actions. CDSL provides DPM as managed software; NSDL has an equivalent (DPM-SHR). Daily-end DPM reconciliation is mandatory; mismatch between DPM-CDSL and broker back-office is an audit-grade exception.

DSC

Full form: Digital Signature Certificate (CCA-licensed; aka Class 2/3 DSC). Meaning: An X.509 certificate issued by a Controller of Certifying Authorities (CCA)-licensed CA, used to sign documents in compliance with the IT Act 2000. Used in broking for: company-level signing on regulatory filings (e.g., compliance certificates, annual returns), executive eSigns (Class 3), and per-employee KYC dossier signing. Distinct from eSign (Aadhaar-OTP-based, individual-only, ephemeral) and DigiLocker eSign (DigiLocker-issued).

e-KYC Setu

Full form: UIDAI Aadhaar e-KYC API gateway Meaning: UIDAI’s e-KYC service that returns a customer’s Aadhaar-verified KYC data (name, DOB, gender, address, photo) after the customer authenticates with biometric or OTP. Available only to licensed KUAs (KYC User Agencies) / sub-KUAs — most brokers are not KUAs themselves and consume e-KYC via a KUA-licensed vendor (e.g., Setu, NSDL-eGov). Use is governed by UIDAI’s Aadhaar (Authentication, Sharing of Information) Regulations and SEBI’s 2020 KYC technology circular. See also: Setu deep dive

e-Mandate

Full form: Electronic Mandate (NACH / UPI) Meaning: Digital authorization given by a customer to a broker / merchant to auto-debit their bank account on prescribed dates and amounts, replacing physical NACH mandate forms. Two flavors: NACH e-Mandate (one-time setup, recurring debits up to the cap, used for SIPs and recurring brokerage charges) and UPI AutoPay (UPI-native, simpler UX, smaller maximum cap per debit). e-Mandate sits inside the NPCI NACH or UPI AutoPay infrastructure; the bank, the corporate (broker), and NPCI all process the mandate. See also: Payment mandates

e-PAN

Full form: Electronic PAN Meaning: Digitally-signed PDF copy of the PAN card issued by NSDL e-Gov / Protean or UTIITSL on behalf of the Income-Tax Department. Functionally identical to physical PAN for KYC purposes; brokers verify the digital signature (signed by the issuer’s CA-certified key) and the PAN number against the income-tax PAN-validation API or NSDL’s database. e-PAN obviates the need for physical card scan in fully digital onboarding flows. See also: PAN, PAN-DOB journey step

ECN

Full form: Electronic Contract Note. Meaning: A digitally-issued contract note delivered to the client via email by T+1 EOD (mandated). The ECN is digitally signed by the broker (DSC or eSign), follows the exchange-prescribed format with trade-by-trade UCC mapping, and serves as the legal trade-confirmation document. See ECN & investor servicing deep-dive.

ECS

Full form: Electronic Clearing Service Meaning: A legacy RBI-operated bulk-debit / bulk-credit mechanism for repetitive payments — used historically for dividends, salaries, SIPs. ECS is largely superseded by NACH (which is more efficient and has clearer rules) since 2016 but still exists for legacy mandates. The acronym surfaces in broker collections occasionally for older systematic-investment instructions that were never migrated to NACH or UPI AutoPay. See also: NACH, Payment mandates

eKYC

Full form: Electronic KYC Meaning: Any KYC flow conducted digitally — Aadhaar-based (via UIDAI e-KYC API or paperless XML), DigiLocker-based, PAN + bank-account-based, or video-based (VIPV / V-CIP). For SEBI-regulated brokers, the controlling document is the 24 Apr 2020 master circular SEBI/HO/MIRSD/DOP/CIR/P/2020/73 (“Clarification on Know Your Client (KYC) Process and Use of Technology for KYC”) plus supplementary circulars permitting video-IPV during COVID and now permanently. The defining property is “no in-person physical-paper KYC” — every step happens through a digital channel with regulator-approved authentication. See also: Mobile registration, Six attribute matching, VIPV

ELM

Full form: Extreme Loss Margin Meaning: A component of total margin charged by the exchange / CCP on F&O positions, on top of SPAN margin, designed to cover the additional loss in tail scenarios beyond SPAN’s confidence interval. Typically calibrated at 3-5% of the notional value for equity F&O, varies for commodity and currency. ELM moves with volatility regimes — exchanges revise from time to time and the broker’s RMS picks the revised value from the daily SPAN/ELM file at BOD. See also: RMS / SPAN methodology deep dive

EMS

Full form: Execution Management System Meaning: The order-routing and -execution layer that sits between an OMS (or a trader’s workstation) and the exchange / market gateway. Specializes in best-execution logic, smart order routing across venues (SOR), iceberg / TWAP / VWAP order slicing, FIX protocol session management with exchanges, and post-trade execution reports. Larger brokers, particularly institutional and algorithmic desks, layer an EMS on top of their OMS; retail-only brokers often fold EMS functionality into a single OMS-EMS combined platform. See also: OMS internals

EOD

Full form: End Of Day Meaning: The post-market window (typically 15:30 IST through ~21:00 IST) during which a broker’s systems run the day’s reconciliation, settlement obligation files, contract notes generation, regulatory file uploads to exchange / CC / depository, AML monitoring batches, surveillance reports, peak-margin computation, and back-office posting. Many EOD activities have hard exchange / regulatory deadlines (margin reporting by next-day 12:00 noon, ECN despatch by 11:00 IST T+1, etc.). See also: EOD settlement integration DAG, Broker process narrative

eSign

Full form: Electronic Signature service Meaning: A MeitY / CCA-defined service letting an individual sign digital documents using their Aadhaar identity, with the signing private key generated on-the-fly by a CCA-licensed Certifying Authority and destroyed after signing (so the user never holds a long-lived private key). Legally equivalent to a physical signature under the IT Act 2000 Section 3A. For brokers, eSign is the standard for the final account-opening document, the DDPI, MTF agreement, and any modification request requiring client signature. Common vendors: NSDL e-Gov, e-Mudhra, Leegality, Digio. See also: Leegality vendor page, Review and eSign journey step

ESM

Full form: Enhanced Surveillance Measure Meaning: A SEBI / exchange surveillance regime targeting small-cap and micro-cap securities with abnormal price-volume action. Two stages; Stage 1 imposes 100% margin and lower price band; Stage 2 adds T-group trade-for-trade and tighter price band. Lists published end-of-day, applied next trading day. Distinct from GSM (graded surveillance, slower-moving) and ASM (additional surveillance, more reactive). ESM is the smallest-cap-targeted of the three frameworks. See also: Surveillance / GSM / ASM deep dive

Family company

Full form: — Meaning: An informal term for a private limited company where shareholders are members of a single family / HUF. Treated as a non-individual entity for SEBI KYC — needs UBO declaration, board resolution authorizing the trading account, list of directors with full KYC, MOA / AOA. Family-company accounts get extra scrutiny in the AML risk-scoring at onboarding because of the related-party-transaction potential. See also: Non-individual entities, HUF

FATCA

Full form: Foreign Account Tax Compliance Act (US) Meaning: A US tax-information-exchange regime, in force in India since the IGA (Inter-Governmental Agreement) of July 2015 and operationalized through Income-Tax Rules 114F-114H. Every Indian financial institution (including brokers) is a “Reporting Financial Institution” and must self-certify each client’s tax-residency status, identify “US Persons” (US citizens, green-card holders, US-tax-resident individuals), and annually report their balances and gross-proceeds to the Indian Income-Tax department, which then exchanges with the US IRS. The self-certification is the mandatory FATCA-CRS declaration captured at onboarding (SEBI master SEBI/HO/MIRSD/SECFATF/P/CIR/2024/12, 20 Feb 2024 centralized the regulatory architecture). FATCA failures (refused declarations, mismatched documentary evidence) escalate to “recalcitrant account” status with 30% withholding implications. See also: FATCA-CRS destination, FATCA-CRS section

FATF

Full form: Financial Action Task Force Meaning: Inter-governmental body (Paris-based, OECD-adjacent) that sets global AML / CFT standards. India is a FATF member; SEBI’s master AML/CFT circular implements FATF’s 40 Recommendations into the SEBI universe. FATF maintains the “grey list” and “black list” of jurisdictions with strategic AML/CFT deficiencies; clients from grey-/black-list countries receive enhanced due diligence at onboarding and throughout the relationship. India was reviewed by FATF in 2023–2024 and rated largely compliant with key recommendations. See also: AML, SEC-FATF

FCNR

Full form: Foreign Currency Non-Resident (Bank) account Meaning: A foreign-currency-denominated term deposit account held by an NRI in a designated bank in India. Currencies typically permitted: USD, GBP, EUR, JPY, CAD, AUD, CHF, SGD, HKD, NZD. Tenor: 1 to 5 years. FCNR balances cannot be used directly for broking trades (you would have to convert to NRE INR first). FCNR sits alongside NRE / NRO in the standard NRI banking-product toolkit; for broking onboarding, FCNR doesn’t directly relate to the trading account, but appears on the asset-declaration form for an NRI’s financial profile. See also: NRI deep dive, NRE, NRO

FEMA

Full form: Foreign Exchange Management Act 1999 Meaning: The statute governing all cross-border capital and current-account transactions, replacing the older FERA. For broking, FEMA enables and constrains NRI / FPI / FII activity: NRI investments in Indian equities are routed through a Portfolio Investment Scheme (PIS) bank account, with prescribed reporting to RBI; FPI flows are subject to investment caps per sector; remittance-out of trading proceeds follows RBI’s prescribed LRS / repatriation channels. RBI master directions and circulars implement specific FEMA provisions. See also: NRI deep dive, NRI conversion lifecycle

Fit and proper

Full form: — Meaning: A regulatory test for entities / individuals seeking SEBI registration as Trading Member, Clearing Member, Authorized Person, KMP, or directorship in a market intermediary. Criteria include: integrity / reputation (no convictions for fraud / financial crime), competence (relevant experience, qualifications), financial soundness (net worth, no defaults / NPA history), absence of regulatory adverse action (SEBI debarments, exchange terminations). Conducted at admission, annually, and event-triggered (change in KMP, ownership). Failure to remain fit-and-proper is grounds for membership cancellation. See also: Fit and proper deep dive

FIU

Full form: Financial Intelligence Unit Meaning: The umbrella term for a country’s anti-money-laundering reporting and intelligence agency. India’s national FIU is FIU-IND (see next entry). In broker context, “FIU” usually means FIU-IND specifically.

FIU-IND

Full form: Financial Intelligence Unit — India Meaning: India’s central national agency for receiving, processing, and analyzing AML / CFT reports — STRs, CTRs, NTRs, Counterfeit-Currency Reports, Cross-Border Wire Transfer Reports. Established 2004, headquartered in New Delhi under the Department of Revenue, Ministry of Finance. Brokers file all suspicious / threshold-breaching transaction reports to FIU-IND via the FINGate digital portal. FIU-IND can issue look-back, demand transaction-history, freeze instructions, and share intelligence with foreign FIUs through the Egmont Group. See also: AML / FIU destination, FIU-IND circulars

FIX

Full form: Financial Information eXchange protocol Meaning: A standardized session-oriented messaging protocol for sending trading-related messages between buy-side, sell-side, and exchange. Current widely-deployed version is FIX 4.4 and FIX 5.0 SP2 / FIXT.1.1. Each Indian exchange has its own FIX dialect / customized fields layered on the base spec — NSE NEAT FIX gateway, BSE Bolt FIX, MCX FOTS FIX. Brokers operating an EMS / DMA channel run FIX sessions to each exchange in addition to the proprietary protocols of the exchange’s native gateway. FIX is the lingua franca for institutional algorithmic order flow. See also: OMS internals

FMC

Full form: Forward Markets Commission Meaning: The erstwhile regulator of commodity derivatives in India, established under the Forward Contracts (Regulation) Act 1952. Merged into SEBI on 28 Sep 2015 under the Finance Act 2015. Since merger, all commodity derivatives — agriculture and non-agri — fall under SEBI’s MRD-jurisdiction, and MCX / NCDEX / ICEX function as SEBI-registered exchanges. The acronym still surfaces in historical contexts and in pre-2015 commodity circulars. See also: SEBI, MCX

GIIN

Full form: Global Intermediary Identification Number Meaning: The 19-character alphanumeric identifier the US IRS assigns to a non-US Financial Institution that has registered with the IRS for FATCA compliance. Format: XXXXXX.XXXXX.XX.XXX. Indian brokers that have registered as PFFIs (Participating Foreign Financial Institutions) under FATCA carry a GIIN; this is one of the standard data points captured in the FATCA self-certification and is reported in the FATCA annual return. See also: FATCA

GSM

Full form: Graded Surveillance Measure Meaning: SEBI / exchange surveillance regime targeting securities with extreme price moves disconnected from fundamentals. Six stages from Stage 0 (trade-to-trade with 5% price band) up to Stage 5 (no trading, only periodic call auction once a week with 5% upper cap). Brokers’ RMS pulls GSM list at BOD; price-band, margin, and trading-window restrictions are applied for the next day. GSM, ASM, ESM together form the three-tier surveillance toolbox; GSM is the slowest-moving (stage progression is monthly / quarterly), ASM is the most reactive (daily list refresh), ESM is small-cap-targeted. See also: Surveillance / GSM / ASM deep dive

HO

Full form: Head Office (SEBI circular ID prefix) Meaning: Appears at the beginning of nearly every SEBI circular ID — SEBI/HO/<department>/... — indicating the circular was issued from SEBI’s head office (Mumbai BKC) as opposed to a regional office. Regional-office circulars use the regional prefix (e.g., SEBI/LAD-NRO/... for the Northern Regional Office Legal Affairs Department). The HO prefix is essentially universal for substantive circulars; LAD-NRO is the notable counterpart for gazette notifications of regulations. See also: Regulatory circulars

HUF

Full form: Hindu Undivided Family Meaning: A unique family-property entity recognized under Hindu law and the Income-Tax Act. Treated by SEBI as a separate non-individual category — has its own PAN, files its own income-tax return, and the Karta (head of HUF) operates the broking account on behalf of all coparceners. Onboarding requires HUF deed / declaration, Karta’s individual KYC, list of coparceners (adult), and HUF PAN. HUFs trade in equities, derivatives, and mutual funds; they cannot have a demat account jointly held with a non-HUF (only HUF members through the Karta). See also: Non-individual entities, Minor / joint accounts

IA

Full form: Investment Adviser Meaning: SEBI-registered entity / individual under the SEBI (Investment Advisers) Regulations 2013 (amended 2020), permitted to give personalized investment advice for a fee. Distinct from a Research Analyst (RA), which publishes non-personalized research / recommendations. An IA cannot execute trades on behalf of the client unless also registered as a broker; an IA cannot accept commissions from product manufacturers; charges must be fee-only (assets-based, fixed, hourly). Often co-located with a discount-broker license in conglomerate group structures. See also: RA, Vendor atlas

ICCL

Full form: Indian Clearing Corporation Limited Meaning: The clearing corporation for BSE — cash, F&O, currency, and commodity (BSE Commodity Derivatives). Subsidiary of BSE Limited. Operates SPAN-based margining for derivatives; novates every BSE trade and stands as CCP. Margins, settlement files, default-related notices for BSE-routed trades flow from ICCL to clearing members. See also: Clearing corp circulars

ICEX

Full form: Indian Commodity Exchange Meaning: A SEBI-registered commodity exchange focused on diamond derivatives — gained limited traction and voluntarily surrendered its recognition in 2022. Mentioned in the regulatory catalog for completeness; current trading volumes are zero. The Indian commodity-exchange space is effectively MCX (dominant), NCDEX (agri), with BSE Commodity as a smaller participant. See also: MCX, NCDEX

IFSC

Full form: Indian Financial System Code. Meaning: RBI-issued 11-character alphanumeric code identifying a specific bank branch in the Indian payment infrastructure (NEFT / RTGS / IMPS routing). Format: 4-letter bank code + “0” + 6-character branch code (e.g., HDFC0000123). Used in client bank-account capture during KYC, on contract notes for client bank settlement, and on TPIN / fund-transfer instructions. Distinct from MICR code (cheque routing) and SWIFT/BIC (international).

IGRC

Full form: Investor Grievance Redressal Committee Meaning: Exchange-level committee that adjudicates client grievances against members when the broker’s own redressal process has failed. The IGRC is the first formal escalation after SCORES intake. Composed of independent professionals (lawyers, retired regulators), it hears the client’s complaint, the member’s response, and passes an award. If the member does not accept the award or the client is dissatisfied, the matter moves to arbitration / ODR. Each exchange operates its own IGRC; SEBI master SEBI/HO/MIRSD/MIRSD_DOP/P/CIR/2023/116 (Jul 2023) standardized IGRC procedure across exchanges. See also: IGRC deep dive

IMD

Full form: Investment Management Department (within SEBI) Meaning: SEBI department covering mutual funds, alternative investment funds (AIF), portfolio managers, REITs/InvITs, and venture-capital funds. Circulars carry the prefix SEBI/HO/IMD/.... Touches broker operations through mutual-fund distribution rules, the BSE Star MF / NSE MF platforms, FPI investment rules, and the regulator of any PMS or AIF a broking-group operates. See also: SEBI-other circulars

IMPS

Full form: Immediate Payment Service Meaning: NPCI-operated 24×7 interbank funds transfer rail, real-time, transactions up to INR 5 lakh. Faster than NEFT for retail-size transfers; less constrained than RTGS in batch windows but with the lower cap. For broker collections, IMPS is one channel for client fund-ins, alongside UPI (now the dominant retail rail), NEFT, and RTGS for larger sums. See also: UPI, NEFT, Payment mandates

Inspection Type I, II, III

Full form: — Meaning: Three categories of audit / inspection events.

Type-I — the annual / periodic compliance inspection conducted by the exchange’s inspection team at the member’s office. Reviews operational compliance, books, settlement, KYC files, segregation, margin.
Type-II — the technology / systems audit (CSCRF audit, VAPT, cyber resilience) typically conducted by an empanelled CERT-In auditor.
Type-III — special / event-triggered inspection following a specific incident, complaint, or regulator-directed investigation. Can be initiated by SEBI directly, an exchange surveillance lead, or via referral from FIU-IND. The CSCRF circular explicitly references Type-I/II/III in the audit-cycle obligations. See also: Inspection types deep dive

Internal audit

Full form: — Meaning: A periodic (typically half-yearly or annual) internal-control assessment conducted by the broker’s in-house internal-audit team or an outsourced CA firm reporting to the audit committee, separate from the statutory external auditor and from concurrent audit. Coverage is set by the audit committee’s annual plan; for SEBI-registered intermediaries the plan must cover the substantive operational areas — funds upstreaming, margin, KRA / CKYC, AML, RMS, contract-note despatch, complaint handling. Findings feed the compliance certificate and the audit committee minutes. See also: Inspection types deep dive

IPF

Full form: Investor Protection Fund Meaning: Pool of money each exchange maintains, contributed from exchange profits and dormant-account credits, to compensate investors who suffer loss due to broker default. Each exchange runs its own IPF (NSE IPF, BSE IPF, MCX IPF), governed by SEBI’s IPF / Investor Service Fund norms and overseen by the exchange’s IPF Trust. Caps per claim: up to INR 35 lakh for the eligible loss (post the 2024 enhancement). IPF claim is the investor’s recourse after a Trading Member is declared a defaulter. See also: IPF deep dive, Member default recovery

IPO

Full form: Initial Public Offering Meaning: The first issue of equity shares by a company to public investors, listing on the exchange. Broker-side IPO activity centers on accepting client bid applications via ASBA / UPI-ASBA, transmitting them to the registrar / merchant banker, handling allotment-day BO credit, and managing listing-day market-making / pre-open. SEBI’s ICDR Regulations 2018 govern the issuer side; brokers integrate with exchange UPI-ASBA + BSE Star / NSE goBID infrastructure for retail bid intake. See also: IPO / OFS broker side deep dive

IPV

Full form: In-Person Verification Meaning: A KYC step where a broker representative physically verifies the customer’s identity by sighting the customer (in person or via video) and confirming originals of OVDs against scanned copies. Now overwhelmingly replaced by VIPV (Video IPV) via SEBI’s permanent permission since 2020. Some non-individual onboarding (large corporate, partnership-firm KYCs) may still use traditional in-person IPV at the customer’s office. See also: VIPV, IPV / VIPV section

IRDA

Full form: Insurance Regulatory and Development Authority of India (IRDAI) Meaning: The Indian insurance regulator. Mostly orthogonal to broking, but appears in two contexts: (a) the CKYC framework — IRDAI is one of the four sectoral regulators feeding into CKYCRR, (b) broking-group companies that hold an IRDAI insurance-broker / corporate-agent license and run insurance products alongside broking. Not to be confused with the older “IRDA” (without I); the regulator has rebranded to “IRDAI” though both forms appear in older circulars. See also: CKYC

ISC

Full form: Investor Service Centre. Meaning: A physical (and now mostly virtual) point where investors raise queries, file complaints, or seek remediation. Exchanges run regional ISCs (e.g., NSE ISC), CDSL/NSDL run depository ISCs, and SEBI runs SCORES as the digital ISC. Brokers are required to display their ISC contact details prominently and to route SCORES complaints back to ISC for resolution within prescribed timelines. See SCORES procedure deep-dive.

IST

Full form: Indian Standard Time (UTC+05:30) Meaning: The single time zone for all Indian exchanges, depositories, clearing corporations, and broking operations. Trading hours, settlement deadlines, regulatory submission cutoffs, BOD / EOD windows are all in IST. Notable cross-border friction: the half-hour offset from UTC complicates ISO-8601 timestamps and FIX-feed timestamp interpretation if not handled explicitly. See also: Broker process narrative

ITD

Full form: Information Technology Department (within SEBI) Meaning: SEBI’s department responsible for technology, cybersecurity, and cyber-resilience oversight. Cybersecurity circulars carry the prefix SEBI/HO/ITD-1/ITD_CSC_EXT/.... The CSCRF foundational circular and its clarification chain all originated from ITD. Distinct from broking-firm “IT department”; in SEBI’s context, ITD-issued circulars are regulatory and apply to all regulated entities. See also: CSCRF

KIN

Full form: KYC Identification Number Meaning: The 14-digit unique identifier CERSAI assigns to each individual or non-individual whose KYC record is registered in CKYCRR. Once a KIN exists, any subsequent KYC by the same person at a different financial institution can be completed by fetching the existing CKYC record using the KIN, instead of redoing OVD collection. The broker captures the KIN at onboarding (either supplied by the customer or returned during the CKYC search) and stores it as a permanent reference. See also: CKYC, CKYC submission section

KMP

Full form: Key Managerial Personnel Meaning: Defined under the Companies Act 2013 Section 2(51) as the CEO / MD / WTD, CFO, Company Secretary, and any officer one level below the board designated by the board. For SEBI broking firms, KMPs are subject to fit-and-proper at admission, periodic disclosure to the exchange, and change-in-KMP intimation within a tight deadline (typically 7 days). Inspections include verification of KMP fit-and-proper undertakings and conflict-of-interest declarations. See also: KMP changes deep dive, Fit and proper

KRA

Full form: KYC Registration Agency Meaning: A SEBI-registered intermediary (SEBI KRA Regulations 2011) that maintains a centralized KYC repository on behalf of SEBI registered intermediaries (brokers, mutual funds, depository participants, portfolio managers). The five active KRAs: CVL KRA (CAMS Investor Services), KRA-MF (formerly NSDL), CAMSKRA, KARVY KRA, NSE-IT-affiliated KRA. The dual-upload circular SEBI/HO/MIRSD/SECFATF/P/CIR/2024/79 requires brokers to upload to both KRA and CKYC; SEBI’s intent is eventual convergence into CKYCRR but the dual-upload remains in force at the time of writing. See also: KRA vendor page, KRA destination, KRA submission section

KYC

Full form: Know Your Customer (process). Meaning: The customer-identification, verification, and risk-profiling process every broker (and KRA) must complete before opening a trading or demat account. Foundational SEBI authorities: SEBI KYC Master Circular Oct 2023, Online KYC Apr 2020, Aug 2023 KYC simplification, Dual KRA+CKYC upload Jun 2024. Combines PAN, Aadhaar/UID, OVD, IPV/VIPV, occupation/income, FATCA/CRS, and PMLA risk categorisation. See also CKYC, KRA, Re-KYC, eKYC.

KYP

Full form: Know Your Promoter (informal usage) Meaning: Internal informal term used in compliance / inspection contexts to refer to the broker’s due-diligence on the promoters / owners of corporate clients / large institutional clients — going beyond standard non-individual KYC to assess group structure, beneficial ownership, political exposure, source of funds. Not a formal SEBI term — informal vocabulary, but commonly appears in inspection-prep checklists and AML EDD packs. See also: AML, Fit and proper

LAD-NRO

Full form: Legal Affairs Department — Northern Regional Office (SEBI) Meaning: SEBI’s New Delhi-based legal affairs office, which issues gazette notifications of new and amended SEBI Regulations. The prefix SEBI/LAD-NRO/GN/... identifies a gazette notification rather than an operational circular. The 2026 SEBI (Stock Brokers) Regulations were issued under this prefix (SEBI/LAD-NRO/GN/2026/291, 7 Jan 2026). Distinct from operational circulars (typically SEBI/HO/MIRSD/... etc.), gazette notifications are the underlying delegated legislation; operational circulars implement them. See also: SEBI-other circulars

Maker-checker

Full form: — Meaning: A workflow control where one user (maker) initiates a transaction or change and a different user (checker) approves it before it takes effect. Standard for high-risk operations — fund withdrawals to non-mapped bank, large modifications to client master, manual KYC overrides, batch-file regenerations. Maker-checker is a CSCRF-tracked control, an internal-audit observation point, and a SEBI inspection focus area especially around client-fund movements. See also: CSCRF, Concurrent audit

MCX

Full form: Multi Commodity Exchange of India Meaning: India’s dominant commodity-derivatives exchange. Trades base metals (zinc, copper, aluminium, lead, nickel), bullion (gold, silver), energy (crude oil, natural gas), and a limited list of agri. Operated since 2003; merged into SEBI’s jurisdiction post-FMC-merger 2015. Clearing handled by MCXCCL. Broker membership of MCX requires a separate registration on top of NSE / BSE membership. See also: MCX vendor page, MCX circulars

MCXCCL

Full form: Multi Commodity Exchange Clearing Corporation Limited Meaning: The clearing corporation for MCX commodity derivatives, subsidiary of MCX. CCP for all MCX trades. Implements its own SPAN-based margining (calibrated to commodity-specific volatility), manages physical-delivery settlement for delivery-based contracts, and operates a Settlement Guarantee Fund for the commodity segment. See also: Clearing corp circulars

MeitY

Full form: Ministry of Electronics and Information Technology Meaning: Union government ministry overseeing IT, electronics, digital-services policy, and the bodies that issue digital certificates. MeitY operates CCA (Controller of Certifying Authorities), licenses Certifying Authorities that issue Digital Signature Certificates / eSign, drives the DigiLocker initiative, and notifies rules under the Information Technology Act 2000 (and would notify rules under the DPDP Act 2023). For broking, MeitY / CCA’s outputs are foundational — eSign, DSC, DigiLocker, IT-Act compliance for record-keeping. See also: MeitY circulars, CCA, DigiLocker

MII

Full form: Market Infrastructure Institution Meaning: SEBI’s term for the three categories of foundational market institutions: stock exchanges, clearing corporations, and depositories. MIIs are subject to a unique higher-tier governance, ownership-cap (max 5% per shareholder / 15% for select categories), public-interest-director composition, and enhanced cyber / operational obligations including the highest CSCRF tier. The SEBI MII Regulations (SECC Regulations 2018, Depositories Regulations 1996 as amended) operationalize the framework. See also: CSCRF, SEBI

MIRSD

Full form: Markets Intermediaries Regulation and Supervision Department (SEBI) Meaning: SEBI’s department for intermediary regulation — stock brokers, sub-brokers, authorized persons, custodians, KRA, registrar/transfer agents, debenture trustees, merchant bankers (the supervisory side). Most broker-specific operational circulars carry the SEBI/HO/MIRSD/... prefix. The KYC, AML, FATCA, DDPI, fund-upstreaming, half-yearly compliance certificate — all flow from MIRSD. This is the department a Trading Member’s compliance team interacts with most. See also: SEBI-MIRSD circulars

Modification request

Full form: — Meaning: Lifecycle event where a customer asks to update one or more fields in their KYC / trading-account master — address, mobile, email, bank account, nominee, segment, brokerage plan, DDPI authorization, FATCA declaration. The modification flows from the broker UI / form, through identity-proof checks (often a second eSign / OTP), through to KRA / CKYC / depository / exchange-UCC updates. Each downstream system has its own modification SLA and acknowledgment file; the broker reconciles all of them before considering the modification complete. See also: Lifecycle: Modifications, CDSL modifications

MRD

Full form: Market Regulation Department (SEBI) Meaning: SEBI’s department for stock exchanges, clearing corporations, depositories — the MII-facing supervision. Operates the rule-base for exchange operations: trading hours, T+0 / T+1 settlement rollout, SPAN methodology approval, surveillance frameworks (GSM / ASM / ESM), short-delivery / auction rules, peak-margin, expansion of segments. Circulars: SEBI/HO/MRD/MRD-PoD-3/P/CIR/.... The T+0 / T+1 settlement circular (SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/20, 21 Mar 2024) is the canonical example. See also: SEBI-other circulars

MSEI

Full form: Metropolitan Stock Exchange of India Meaning: A SEBI-registered stock exchange with cash and currency-derivatives segments. Founded 2008, has remained a distant third behind NSE and BSE in equity volumes. Currency-derivative segment had occasional traction; cash segment is largely dormant. Brokers occasionally hold MSEI membership for completeness but trading volumes are minimal. Operates its own clearing through Metropolitan Clearing Corporation of India (MCCIL). See also: NSE, BSE

MTF

Full form: Margin Trading Facility Meaning: A SEBI-regulated facility (MTF Regulations / SEBI circular SEBI/HO/MIRSD/DOP/CIR/P/2017/...) where a broker funds a portion of the client’s purchase of approved cash-market scrips, taking the funded shares as collateral via DDPI / pledge with the depository. Client pays initial margin (typically 25%) and the broker funds the rest; client repays plus interest within the prescribed leverage window. Shares pledged in CDSL / NSDL margin pledge account; client may unpledge by repayment. MTF is broker-funded, not exchange-funded; counterparty risk sits with the broker. Strict per-scrip lists, leverage caps, and reporting cadences apply. See also: MTF operational deep dive, CDSL MTF / pledge page, Margin pledge section

MTM

Full form: Mark-to-Market Meaning: Daily valuation of open positions at the day’s settlement price, with the resultant P&L crystallized (debited / credited) in the trading account. For derivatives, MTM is settled in cash daily by the CCP; for cash-segment leveraged products (MTF), MTM determines additional margin calls. The MTM file is one of the EOD inputs the broker’s back-office posts to the client ledger before next-day BOD; mismatches between exchange MTM and broker-internal computed MTM are reconciled by EOD T+1. See also: EOD settlement integration DAG

MWPL

Full form: Market Wide Position Limit Meaning: The maximum aggregate open interest (across all market participants) permitted in a single underlying stock in the F&O segment. Set at 20% of the free-float of the underlying. Once aggregate OI breaches 95% of MWPL, the exchange enters “ban period” — no new positions allowed, only square-off. Brokers’ RMS pulls the MWPL utilization file intra-day; a stock entering ban-period triggers UI flags, blocked new-position orders, and compliance-side reporting. See also: Surveillance / GSM / ASM deep dive

NACH

Full form: National Automated Clearing House Meaning: NPCI-operated centralized bulk-debit / bulk-credit mechanism replacing ECS in 2016. Used for SIPs, recurring brokerage debits, dividend pay-outs, government subsidy disbursements. NACH e-Mandate (paperless e-mandate registration with Aadhaar OTP or Net-banking authentication) is the modern flavor. For broker collections, NACH covers larger / recurring debits that exceed UPI AutoPay caps or require longer mandate tenure. See also: Payment mandates

NCDEX

Full form: National Commodity & Derivatives Exchange Limited Meaning: Indian commodity exchange focused on agriculture commodities — guar gum / seed, cotton, soybean, mustard, jeera (cumin), turmeric, chana. Operates since 2003, SEBI-regulated post-2015 FMC merger. Clearing handled by NCDEX’s own clearing corporation. Smaller in volume than MCX but with agri-segment specialty; brokers typically hold NCDEX membership alongside MCX if they serve agri-commodity speculative or hedging clients. See also: MCX

NCL (NSCCL)

Full form: NSE Clearing Limited (formerly National Securities Clearing Corporation Limited) Meaning: The clearing corporation for NSE — cash, F&O, currency, debt, commodity (NSE Commodity Derivatives), tri-party repo, securities lending and borrowing. Subsidiary of NSE. Rebranded from NSCCL to NCL in 2018, both acronyms still appear in circulars. NCL is India’s largest CCP by trade value cleared; CSCRF treats NCL as an MII with the highest tier of obligation. See also: Clearing corp circulars

NEFT

Full form: National Electronic Funds Transfer Meaning: RBI-operated batch-based interbank funds transfer rail; 24×7 since Dec 2019; settled in half-hourly batches. No upper transaction limit (though banks set internal caps); slower than IMPS / UPI but supports larger amounts. For brokers, NEFT is one of the standard rails for client fund-in and pay-out, typically used for amounts above UPI / IMPS caps. See also: Payment mandates

Net worth requirement

Full form: — Meaning: Minimum net worth (paid-up capital + free reserves) a Trading Member / Clearing Member must maintain to retain membership and operate prescribed segments. SEBI Stock Brokers Regulations and exchange byelaws set the slabs: typically INR 1 crore for a Trading Member, higher for Clearing Member, higher still for QSB. Computed on the audited financials and self-certified to the exchange semi-annually with the half-yearly compliance certificate. Breach triggers progressive consequences — restricted exposure, segment deactivation, eventually deregistration. See also: Member compliance: BMC and ABC

Nomination

Full form: — Meaning: Customer-provided declaration naming up to three persons (with allocation percentages) to receive the demat / broking-account assets upon the customer’s death. SEBI’s nomination circular (SEBI/HO/MIRSD/POD-1/P/CIR/2025/... and prior) mandates capture or explicit “opt-out” at onboarding for all individual accounts. Nominees can be updated lifecycle; declarations are stored at both broker and depository. On death, the nominee initiates transmission with the supporting documents (death certificate, KYC, etc.). See also: Nomination section, Nominations journey step, Transmission

NPCI

Full form: National Payments Corporation of India Meaning: RBI-incentivized umbrella organization for retail payment systems in India. Operates UPI, IMPS, NACH, AePS, RuPay (card scheme), Bharat BillPay, FASTag, e-KYC e-Aadhaar Authentication API rails (in some). Not a regulator itself but a payment-system operator; supervised by RBI. For brokers, NPCI is the upstream of every payment rail used for client collections / pay-outs except RTGS / NEFT (which are RBI-direct). See also: NPCI circulars, UPI, NACH

NRE

Full form: Non-Resident External (Rupee) account Meaning: INR-denominated bank account held by an NRI, fully and freely repatriable. Funds from abroad credited to NRE are tax-free; interest is tax-free. For NRI broking, repatriable equity investments are routed through an NRE-linked PIS (Portfolio Investment Scheme) account: pay-in from the NRE PIS account, pay-out back to the same NRE PIS account, repatriation done at the NRI’s discretion subject to FEMA reporting. See also: NRI deep dive, NRI conversion lifecycle

NRI

Full form: Non-Resident Indian Meaning: An Indian citizen or person of Indian origin who resides outside India for more than 182 days in a financial year (definition for FEMA purposes; income-tax has a separate 60-/120-day definition). NRIs onboard for Indian broking with a distinct workflow: PAN (mandatory), NRE / NRO / PIS bank linkage, FEMA-compliant trading restrictions (intraday in F&O permitted but no intraday in cash for repatriable accounts, no commodities, no agricultural-land related investments), FATCA / CRS self-certification, NRI-specific tax deduction at source. RBI’s PIS reporting is the back-end overlay. See also: NRI deep dive, NRI section, NRI conversion lifecycle

NRI conversion

Full form: — Meaning: Lifecycle event where an existing resident-Indian client becomes an NRI (took up overseas residence beyond the 182-day threshold) and the broking account must be re-classified. Triggers: re-KYC with NRI documents, new bank-account linkage (NRE / NRO / PIS), new FATCA-CRS declaration, segment restrictions enforcement, possibly a fresh account-opening (depending on the broker’s policy on resident-to-NRI conversion vs new account). Documented as a distinct lifecycle scenario because the field deltas and downstream propagation are non-trivial. See also: NRI conversion lifecycle

NRO

Full form: Non-Resident Ordinary (Rupee) account Meaning: INR-denominated bank account held by an NRI, used for managing income earned in India — rent, dividend, sale proceeds of pre-NRI investments. Repatriation from NRO is capped at USD 1 million per financial year (after applicable tax). For NRI broking, the NRO-linked PIS variant handles non-repatriable equity investments (typically pre-existing holdings inherited from resident days). See also: NRI deep dive

NSDL

Full form: National Securities Depository Limited Meaning: India’s first depository, founded 1996, the senior of the two SEBI-registered depositories (the other being CDSL). Promoters: IDBI Bank, UTI, NSE. Holds dematerialized securities; uses 16-digit BO-ID where the first 8 digits = DP-ID. Provides SPEED-e for instructions, IDeAS for holding views, e-Voting, e-CAS (consolidated account statement). NSDL e-Governance is a major KUA / sub-KUA for Aadhaar e-KYC and an empanelled CA issuing DSC and operating eSign. Same parent group also operates NSDL Payments Bank. See also: NSDL vendor page, NSDL circulars, NSDL BO destination

NSE

Full form: National Stock Exchange of India Meaning: India’s dominant equity, F&O, currency, debt, and commodity-derivatives exchange. Founded 1992, demutualized progressively. Operates the Nifty 50 / Nifty 500 family of indices. Clearing through NCL (NSE Clearing). NSE IPO has been pending for several years through 2026; corporate-governance / settlement-issue case-load has been a regulatory focus. Broker membership of NSE is the most-active segment for nearly every Indian broker. See also: NSE vendor page, NSE circulars

NTR

Full form: Non-Profit Organization Transaction Report Meaning: A specific FIU-IND report for receipt of any funds by or on behalf of a non-profit organization (registered Sec 8 company, registered trust, registered society) in single or aggregated transactions of INR 10 lakh+ per month. Threshold matches CTR; obligation arises because of FATF concerns around NPO misuse for terrorism financing. Less common in broker context (broker collections from NPO clients are typically small / atypical), but appears in the reporting checklist. See also: STR, CTR, FIU-IND

OCR

Full form: Optical Character Recognition. Meaning: Image-to-text extraction used in KYC document processing — PAN card, Aadhaar XML (when not paperless), bank statement, ITR, utility bill. Vendor stack in this category includes HyperVerge OCR, Idfy, Karza/Perfios, Veri5. OCR is usually paired with confidence scoring; below a threshold (typically 90%), the document routes to maker-checker review.

ODR

Full form: Online Dispute Resolution Meaning: SEBI-mandated online platform (SEBI/HO/OIAE/OIAE_IAD-1/P/CIR/2023/131, 31 Jul 2023, with subsequent extensions) where investor complaints unresolved at SCORES and IGRC level proceed to mediation or arbitration online. The ODR portal is operated by MIIs (exchanges and depositories collectively) and onboards independent mediators / arbitrators. Investor’s last-tier formal recourse before the courts. See also: ODR deep dive, SCORES, IGRC

OFS

Full form: Offer for Sale (through stock exchange) Meaning: SEBI-permitted mechanism for promoters or large shareholders to sell a chunk of their holding through the exchange’s auction-style window, distinct from a regular block deal. Two days — T = institutional, T+1 = retail. Typically used by promoters to meet minimum-public-shareholding norms or by government for divestment. Broker integrates with the exchange OFS bidding platform; retail clients place bids via their broker app on T+1. See also: IPO / OFS broker side deep dive

OIAE

Full form: Office of Investor Assistance and Education (SEBI) Meaning: SEBI department for investor complaints, education, awareness, and the SCORES portal. Operates the investor-grievance master pipeline and oversees IGRC / ODR. Circulars carry SEBI/HO/OIAE/.... The DigiLocker-for-unclaimed-assets circular (SEBI/HO/OIAE/OIAE_IAD-3/P/CIR/2025/32, 19 Mar 2025) and ODR circular (SEBI/HO/OIAE/OIAE_IAD-1/P/CIR/2023/131) are notable examples. See also: SEBI-other circulars, SCORES

OMS

Full form: Order Management System Meaning: The core trading-platform component that ingests orders (from client UI, dealer terminal, algo channel, API), runs pre-trade checks (RMS limits, KYC active, segment enabled, scrip restrictions), sends to the exchange via FIX or proprietary gateway, tracks order state, processes execution reports, and feeds the back-office. Industry-standard pieces of an OMS: order-book, position-book, trade-book, RMS integration, exchange-gateway adapters, audit-trail. Most retail brokers consume an OMS as SaaS from vendors (Refinitiv, Symphony Fintech, FIS, FT Order, in-house). See also: OMS internals deep dive

OTP

Full form: One-Time Password Meaning: A short-lived (typically 30-second to 10-minute validity) numeric or alphanumeric password delivered via SMS, email, voice call, or authenticator app, used as the second factor of authentication. In broking, OTPs gate sensitive operations: login (2FA), order placement (on internet-based trading), withdrawal, fund-in mandate setup, modification request, eSign authentication for documents, DigiLocker consent, UPI mandate authorization. See also: 2FA, eSign

OVD

Full form: Officially Valid Document Meaning: PMLA Rule 2(d) defined list of documents acceptable as identity / address proof — passport, voter ID, driving license, Aadhaar (in permitted forms), NREGA job card, letter from National Population Register. For broking onboarding, the OVD list determines what the customer can upload as identity / address proof; the broker’s KYC workflow validates the OVD against an issuer database (where API exists) or by digital-signature verification (DigiLocker) or by visual / OCR check (uploaded scans). See also: Identity documents section, Address documents section

PAN

Full form: Permanent Account Number Meaning: Income-Tax Department-issued 10-character alphanumeric identifier (format: AAAAA9999A). Mandatory for every Indian broking account; verified at onboarding against the Income-Tax PAN-validation API (returns name + DOB + status) or against NSDL’s PAN-detail web service. PAN-Aadhaar linkage is a separate mandatory check (since the linkage deadline in 2023, PAN becomes inoperative if not Aadhaar-linked, blocking KYC). Brokers also validate that PAN is not on the Income-Tax department’s list of suspended / surrendered / fake PANs. See also: PAN-DOB journey step, Personal-identity section, Six attribute matching

Partnership, LLP, Corporate broker

Full form: — Meaning: Three legal forms a broking firm can take. Partnership (under the Partnership Act 1932) — historical form, less common today, unlimited liability for partners. LLP (Limited Liability Partnership, under LLP Act 2008) — limited liability + tax pass-through, increasingly common for mid-size brokers. Corporate broker — broking firm constituted as a private or public limited company under the Companies Act 2013, the most common form for new registrations especially in the post-2018 environment. Each form has different SEBI registration documents, KMP definition, and audit / disclosure obligations. See also: Non-individual entities

Pay-in and Pay-out

Full form: — Meaning: The two halves of every settlement obligation. Pay-in — what a member owes to the clearing corporation for a settlement (cash for purchases, securities for sales). Deadline is settlement-day (T+1 currently for cash equity). Pay-out — what the CC owes back (cash for sales, securities for purchases). Each member’s net obligation across all clients is computed by the CC; the CC moves funds and securities accordingly. From 2023 the direct-payout-to-demat reform requires the CC to credit pay-out securities to the buyer’s BO-ID directly, not through broker pool. See also: Direct payout to demat, Short delivery, Auction settlement

Peak margin

Full form: — Meaning: A SEBI-introduced (2020–2021 phased) margin computation regime where the broker’s margin charged to a client is the highest of four snapshots taken intra-day by the exchange, rather than just end-of-day. Reduces intra-day leverage available to the client. The peak-margin file is one of the EOD outputs from the exchange; brokers reconcile against their own internal RMS records and report peak-margin compliance / shortfalls daily. Penalties apply for client-level shortfalls. See also: Peak margin section, RMS / SPAN methodology deep dive

Penny drop

Full form: — Meaning: Bank-account verification by depositing a small token amount (INR 1 historically) into the customer’s bank account and confirming the account holder’s name returned by the bank. Used at onboarding to validate the bank-account-PAN link before activating fund-transfer instructions. Largely superseded by Account Aggregator-pulled bank statement (which returns holder name without the trial debit) and by API-based bank-account verification services (Decentro, Razorpay, Hyperverge). The “penny” is now usually INR 0.01 or INR 0.10 and is reversed immediately. See also: Bank account section, Bank account journey step, Decentro vendor page

PEP

Full form: Politically Exposed Person Meaning: PMLA-defined high-AML-risk category — individuals who are or have been entrusted with prominent public functions (heads of state, ministers, senior judiciary, senior military, ambassadors, senior officials of international organizations) and their immediate family and close associates. Brokers must screen each client against PEP databases at onboarding, conduct enhanced due diligence on PEP clients (source-of-funds, source-of-wealth), get senior-management approval to onboard, and report any STR involving a PEP with heightened priority. Domestic vs foreign PEP carry different scrutiny levels. See also: PEP / AML section, AML

Periodic call auction

Full form: — Meaning: Trading mechanism applied to illiquid scrips, where instead of continuous matching, the scrip trades only in periodic call-auction windows (hourly, or as defined by the exchange). Eligibility based on price-volatility / liquidity criteria; list published end-of-day, applied next trading day. Effects: clients can only place orders in the defined windows, no continuous matching. Brokers’ OMS rejects orders outside the windows for these scrips. See also: Pre-open / closing auction deep dive

PFRDA

Full form: Pension Fund Regulatory and Development Authority Meaning: Indian pension regulator established under the PFRDA Act 2013. Governs NPS (National Pension System) and Atal Pension Yojana. Touches broking through the CKYC framework (PFRDA is a sectoral regulator feeding into CKYCRR) and through broker subsidiaries / group companies running PFRDA-registered POPs (Point of Presence) for NPS distribution. Largely orthogonal to core broking operations. See also: CKYC

PIS

Full form: Portfolio Investment Scheme (RBI / NRI) Meaning: RBI’s scheme under FEMA permitting NRIs to invest in Indian listed equities (and select listed securities) through a designated PIS bank account at an Authorized Dealer (AD-Category I) bank. PIS accounts come in two flavors: NRE-PIS (repatriable) and NRO-PIS (non-repatriable). All NRI broking trades — buy / sell of listed shares — flow through this PIS account; the AD bank reports to RBI quarterly. NRI clients must designate exactly one PIS bank for their broking activity (single-bank-route rule). See also: NRI deep dive, NRE, NRO

PMLA

Full form: Prevention of Money Laundering Act 2002 Meaning: The statutory foundation for AML in India, with PMLA Rules 2005 operationalizing the obligations. Defines “money laundering” (Sec 3), the predicate offences (Schedule), the role of FIU-IND, record-keeping obligations (Sec 12 of PMLA, Rule 3-5 of PMLA Rules — 8-year retention from end-of-relationship), reporting obligations (STR, CTR, NTR, Counterfeit-Currency Report, Cross-Border Wire Transfer Report). SEBI’s AML / CFT master circular implements PMLA for SEBI-regulated entities. See also: AML, AML / FIU destination

PMS

Full form: Portfolio Management Services Meaning: SEBI-regulated regime (SEBI Portfolio Managers Regulations 2020) where a SEBI-registered portfolio manager manages investments for HNI clients (minimum INR 50 lakh per client) on a discretionary or non-discretionary basis. Distinct from mutual funds (pooled), from RA / IA (advisory only). Many broking groups operate a PMS subsidiary alongside the broking license. For broker-only operations, the PMS license is separate and reporting flows to SEBI’s IMD department. See also: SEBI-other circulars

POA

Full form: Power of Attorney Meaning: Historically, the broker-favouring instrument by which a client authorized the broker to operate the client’s demat account (debit shares for settlement, pledge securities, etc.). Phased out and replaced by DDPI since April 2022 (SEBI circular SEBI/HO/MIRSD/DOP/P/CIR/2022/44). POAs given before April 2022 remain valid but most brokers actively migrate clients to DDPI; new accounts opened after April 2022 must use DDPI, not POA. See also: DDPI

Pre-open session

Full form: — Meaning: The call-auction window at the start of each trading day (09:00–09:15 IST on NSE / BSE cash segment) that determines the opening price. Order entry / modification / cancellation between 09:00–09:08; order matching at single equilibrium price between 09:08–09:12; transitional buffer 09:12–09:15 with order entry only. Continuous trading starts at 09:15. Used to compress overnight news flow into a single price-discovery moment; for illiquid scrips, the pre-open serves as the only trading window (periodic call auction model). See also: Pre-open / closing auction deep dive

QSB

Full form: Qualified Stock Broker Meaning: A higher-tier broker category introduced by SEBI in 2023, defined by quantitative thresholds — number of active clients (5+ lakh), trade value handled, available capital, deposits / AUM with the broker. QSBs face enhanced obligations: stricter cybersecurity (top CSCRF tier or near-MII), enhanced governance (mandatory committees), heightened systemic-importance assessments, more frequent inspections. The list is published / updated by SEBI based on the threshold computation. Touches roughly the top dozen Indian brokers as of 2025. See also: SEBI-MIRSD circulars, CSCRF

RA

Full form: Research Analyst Meaning: SEBI-registered intermediary under SEBI (Research Analysts) Regulations 2014, permitted to publish research reports and stock recommendations on a non-personalized basis. Distinct from IA (Investment Adviser) — RA cannot give personalized advice for a fee tailored to a specific client’s portfolio. Often co-located with a broking license (the same group runs RA-licensed research alongside execution-only broking). See also: IA, Vendor atlas

RBI

Full form: Reserve Bank of India Meaning: India’s central bank and the regulator of banks, NBFCs, payment systems, and foreign exchange. For broking, RBI’s relevance is indirect-but-pervasive: it regulates the banks that hold the broker’s segregated client-funds account, it operates the RTGS / NEFT rails, it issues FEMA master directions governing NRI / FPI / FII broker activity, it co-regulates Account Aggregators, and it overseas NPCI. RBI circulars relevant to broking sit in the master-directions catalog rather than as one-off circulars. See also: RBI circulars, FEMA

Re-KYC

Full form: — Meaning: Periodic re-verification of an existing client’s KYC, typically at risk-category-driven cadence — every 10 years for low-risk clients, every 8 years for medium-risk, every 2 years for high-risk (the cadence varies across regulators; SEBI’s master circular set the broking norms). Re-KYC may involve only confirmation of unchanged details (negative-affirmation), or full refresh with new OVDs depending on the trigger. KRA and CKYC both maintain “last verified” timestamps; the broker monitors expiry and proactively initiates re-KYC ahead of the deadline. See also: Lifecycle: Re-KYC

RMS

Full form: Risk Management System Meaning: The pre-trade and intra-day system that monitors a broker’s exposure across clients, segments, and instruments — checks each new order against client margin, applies SPAN + ELM + Var-margin formula, blocks orders that exceed limits, monitors intra-day MTM losses, triggers margin-call notifications, executes auto-square-off when threshold breached. RMS is the broker’s primary mechanism for managing counterparty risk to clients and for staying within the exchange-prescribed margin envelope. Most RMS implementations sit between the OMS and the exchange gateway. See also: RMS destination, RMS / SPAN methodology deep dive, Back-office and RMS appendix

RNOR

Full form: Resident but Not Ordinarily Resident Meaning: Income-Tax Act 1961 intermediate residency category — applies to a returning NRI (or someone meeting the 60-/120-day Indian-stay threshold but not the 729-day-over-7-years test). RNOR keeps NRI-tax-treatment benefits on foreign-sourced income for the transition period (typically 2 years post-return). For broking, RNOR doesn’t directly change the trading-account setup (the client is residentially “Indian” but tax-wise “RNOR”), but appears in the FATCA-CRS self-certification and in tax-deducted-at-source classification. See also: NRI conversion lifecycle

RTGS

Full form: Real Time Gross Settlement Meaning: RBI-operated real-time interbank funds-transfer rail for high-value transactions — minimum INR 2 lakh, no upper cap. Settlement is gross (each transaction settled individually) and immediate. For brokers, RTGS is the rail for large client fund-ins, pay-outs to HNI clients, and inter-broker settlement transfers. RBI extended RTGS availability to 24×7 in Dec 2020. See also: NEFT, Payment mandates

Running account settlement

Full form: — Meaning: Quarterly settlement obligation: every broker maintaining a continuous (running) client account must transfer back to the client any free credit balance (cash unused for outstanding obligations) at the end of each quarter (or monthly, depending on the option the client elected at onboarding). SEBI’s running-account circular SEBI/HO/MIRSD/DOP/P/CIR/2022/... consolidated and tightened the framework. Operationally: identify credit balance at quarter-end T+1, transfer to the client’s mapped bank account, record proof, despatch settlement letter. Failure → SEBI / exchange penalty + investor complaint risk. See also: Running account settlement section, Client funds upstreaming

SCORES

Full form: SEBI Complaints Redress System Meaning: SEBI’s online portal where investors lodge complaints against any SEBI-registered intermediary — broker, mutual fund, RTA, depository, listed company. SCORES 2.0 (rolled out 2023) tightened SLAs: intermediary has 21 days to respond after a complaint is registered; unresolved escalates to IGRC and onwards to ODR. Brokers maintain a dedicated SCORES desk, must mark each complaint resolved with a documented response, and report monthly counts to SEBI. SCORES non-responsiveness is itself a regulatory violation captured in inspection. See also: SCORES procedure deep dive, IGRC, ODR

SEBI

Full form: Securities and Exchange Board of India Meaning: India’s apex capital-markets regulator, established by SEBI Act 1992. Regulates stock exchanges, clearing corporations, depositories, brokers, sub-brokers (now APs), KRAs, custodians, mutual funds, AIFs, PMS, IAs, RAs, RTAs, debenture trustees, merchant bankers, FPIs, and many other intermediary categories. Issues circulars (SEBI/HO/<dept>/...) and regulations (gazetted via LAD-NRO). HQ: Bandra-Kurla Complex, Mumbai. Subsumed FMC in 2015 (commodity derivatives now under SEBI). Multiple departments — MIRSD, MRD, IMD, OIAE, CFD, ITD, LAD-NRO — partition the regulatory load. See also: SEBI-MIRSD circulars, SEBI-other circulars, Regulatory circulars

SEC-FATF

Full form: Securities — Financial Action Task Force (SEBI internal cell) Meaning: SEBI-internal cell within MIRSD focused on FATF-aligned obligations — AML / CFT, FATCA, CRS implementation in the SEBI-regulated universe. Circulars on AML, FATCA, CRS carry the prefix SEBI/HO/MIRSD/SECFATF/... — the 2024 dual-upload (SEBI/HO/MIRSD/SECFATF/P/CIR/2024/79), the FATCA centralization (SEBI/HO/MIRSD/SECFATF/P/CIR/2024/12), and the AML master circular (SEBI/HO/MIRSD/SECFATF/P/CIR/2024/78) all originate from this cell. See also: SEBI-MIRSD circulars, FATF

SGF

Full form: Settlement Guarantee Fund Meaning: A pool of funds maintained by a clearing corporation as part of the default waterfall, used to settle obligations of a defaulting member after their own margins and collaterals are exhausted. SGF is the broader pool; Core SGF is the dedicated, first-tapped sub-pool under SEBI’s CCP Recovery & Resolution norms (post 2014). Brokers contribute to SGF via prescribed deposits; exchange-CCP allocates from SGF based on a documented waterfall before any haircut on non-defaulting members. See also: SGF / Core SGF deep dive, Pay-in default and Core SGF

Short delivery

Full form: — Meaning: A member fails to deliver the full quantity of sold securities by the pay-in deadline (T+1 currently). The CC marks the shortfall; the auction process kicks in the next day; the buyer receives the auction-purchased shares; the defaulting member is debited at the auction price plus close-out factor. Short delivery is a normal operational reality (not necessarily fraud — can be reconciliation timing, mis-mapping, or genuine settlement-failure) but is tracked, reported, and contributes to the member’s risk score. See also: Short delivery / auction deep dive, Auction settlement

SLBM

Full form: Securities Lending and Borrowing Mechanism Meaning: Exchange-operated framework (NSE SLB / BSE SLB) where holders of securities can lend them out for a fee, and borrowers (typically those wanting to short-sell or settle a short delivery) can borrow. Tenor: 1 month, monthly settlement cycle. SLB is the regulated lending channel; outside-of-SLB lending of securities (peer-to-peer or unregulated) is prohibited. Brokers offer SLB access to their clients; the broker is the intermediary that routes to the exchange SLB platform. See also: SLBM deep dive

SMS

Full form: Short Message Service. Meaning: Used heavily in broking for transactional communication: order-execution confirmations, margin-call alerts, contract-note dispatch notifications, OTP delivery, AMC reminders, dormancy alerts. Subject to TRAI DLT registration (header registration, content-template pre-approval, consent capture). SEBI mandates SMS dispatch for specific events (e.g., margin-shortfall, contract-note ready) — see operations/messaging-and-dispatch.

SOR

Full form: Smart Order Routing Meaning: Algorithmic logic that decides which exchange (NSE, BSE) to send an order to, in real time, based on the best available price net of execution cost. Triggered when the same security is listed on multiple exchanges. SEBI requires explicit consent from the client for SOR; the broker must disclose the SOR engine’s logic and provide order-by-order proof that the routing decision was best-execution-compliant. Less ubiquitous in retail-only flows; common in institutional and direct-market-access setups. See also: OMS internals deep dive

SPAN

Full form: Standard Portfolio Analysis of Risk Meaning: Risk-based margining methodology originated by CME and adopted by Indian exchanges (NSE, BSE, MCX) for derivatives. SPAN computes the worst-case loss across 16 (or 25 in some implementations) market scenarios (price up / down, volatility up / down, time decay) and the SPAN margin is the highest loss in those scenarios. SPAN file is published by the exchange end-of-day (with intra-day refreshes during volatile markets) and ingested into broker RMS at BOD. Exchange-published SPAN + Exposure margin (ELM) + Var margin formed the total derivative margin pre-2020; post-2020 peak-margin overlay adds another constraint. See also: RMS / SPAN methodology deep dive

SRO

Full form: Self-Regulatory Organization Meaning: A SEBI-recognized industry body that exercises delegated regulatory authority over its members — sets standards, audits compliance, takes disciplinary action. As of 2025, SEBI has approved the Industry Standards Forum (ISF) — a broker-side SRO — for stock brokers, with phased operationalization. The SRO concept also covers asset management (AMFI for mutual funds, ARIA for IAs, ANMI for stock-brokers’ association). The 2026 Stock Brokers Regulations include explicit hooks for SRO recognition. See also: SEBI-MIRSD circulars

Statutory audit

Full form: — Meaning: Annual external audit conducted by an independent chartered accountant firm under the Companies Act 2013 (Section 139) for the broking firm’s financial statements. For SEBI-registered brokers, the statutory auditor must also confirm regulatory-specific items: client funds segregation, KRA / CKYC compliance, peak margin compliance, half-yearly net-worth certificate, AML alert disposition. The audit report carries weight in the broker’s exchange filings and is the basis of the next year’s fit-and-proper certification. See also: Inspection types deep dive

STR

Full form: Suspicious Transaction Report Meaning: Mandatory FIU-IND report for any transaction that, in the reporting officer’s reasonable belief, may relate to proceeds of crime or terrorism financing, irrespective of value. No threshold — even an INR 5,000 transaction can be STR-worthy if pattern is suspicious. Filing deadline: 7 working days from the date of detection. Brokers maintain an internal STR-evaluation workflow (compliance / principal officer review), file via FINGate, and retain supporting documents for the prescribed period. See also: CTR, NTR, FIU-IND, AML / FIU destination

System audit

Full form: — Meaning: Periodic (typically annual) technical audit of a broker’s IT systems — security controls, data integrity, system architecture, operational resilience. For SEBI brokers, the system audit is conducted by a CERT-In empanelled auditor and now operates under the CSCRF umbrella (since the Aug 2024 framework). Audit covers VAPT findings, evidence-retention practices, BCP / DR test results, incident-response history, vendor due diligence files. Report submitted to exchange and retained for inspection. See also: System audit deep dive, CSCRF

T+0, T+1, T+2

Full form: Trade-date Plus N settlement Meaning: Settlement cycle naming convention. T+2 was the standard till Jan 2023; T+1 went live progressively across 2023 (fully implemented Jan 2023); T+0 rolled out in optional beta on 21 Mar 2024 (SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/20) for a small list of scrips, since expanded in 2025. Under T+1, a buy on Monday means securities credited on Tuesday and funds debited Tuesday; under T+0, the same-day settlement happens by 16:30 IST. The shorter cycle improves capital efficiency for clients but compresses operational windows for brokers (margin computation, EOD, contract notes despatch). See also: T+0 / T+1 settlement deep dive

TIN

Full form: Taxpayer Identification Number (in FATCA / CRS context) Meaning: The foreign tax identifier of a client tax-resident in a country other than India. Captured during onboarding as part of the FATCA / CRS self-certification — for US tax residents this is the US SSN or US-ITIN; for other jurisdictions it is the local equivalent (UK UTR, Singapore TIN, Australia TFN, etc.). TIN is reported annually in the FATCA / CRS return. Missing or unverifiable TIN with no reasonable explanation escalates the client to “recalcitrant account” status. See also: FATCA, CRS

TM

Full form: Trading Member Meaning: An entity (typically a broker) registered with an exchange to trade on behalf of clients or for its own account. TM membership is segment-specific (cash, F&O, currency, commodity). A TM may also be its own CM (combined TM+CM) or rely on a separate Professional Clearing Member. Trading Members carry BMC, ABC, net-worth, and a battery of operational compliance obligations (KYC, margin, settlement, contract note, AML). See also: Exchange registration, Member compliance: BMC and ABC

TRAI DLT

Full form: Telecom Regulatory Authority of India — Distributed Ledger Technology framework Meaning: TRAI’s framework for commercial SMS, mandated since 2018 and tightened in 2020, requiring every entity sending transactional / promotional SMS in India to register on a DLT (Distributed Ledger Technology) platform run by a TRAI-approved telecom operator (Jio, Airtel, Vi, BSNL). Each sender registers its Principal Entity ID, each template is pre-registered with a Header and Content Template ID; runtime SMS sending must reference the registered template. Brokers register all transactional templates (OTP, order confirmation, contract-note despatch, fund-call, settlement alert) here. NB: TRAI’s “DLT” is conceptually distinct from blockchain-DLT; it is a private permissioned ledger run by telcos, not a public blockchain. See also: DLT framework deep dive, DLT comms destination, Communications appendix

Transmission

Full form: — Meaning: Lifecycle event where assets in a deceased account-holder’s demat / broking account are transferred to the nominee or legal heir. Distinct from “transfer” (which requires the account-holder’s own instructions). Triggered by death certificate; standard documents: death certificate, nominee KYC, succession / probate / legal-heir certificate (if no nominee), and the executed transmission request form. Each depository has its own transmission process; the broker coordinates between bank, depository, and (for non-listed assets) the company / RTA. See also: Lifecycle: Transmission, Nomination

UCC

Full form: Unique Client Code Meaning: The exchange-mandated unique identifier for each client of each Trading Member — assigned by the broker, registered with each exchange the client trades on (NSE UCC, BSE UCC, MCX UCC are separate registrations even for the same client). UCC carries the client’s PAN, KYC reference, segment authorizations. Every order routed to the exchange carries the UCC tag, so the exchange can attribute the order to the right end-client for surveillance, position limits, and reporting. See also: NSE UCC destination, BSE UCC destination, MCX UCC destination, Exchange registration

UPI

Full form: Unified Payments Interface Meaning: NPCI-operated 24×7 real-time payment system, the dominant retail payment rail in India since ~2018. Account-to-account transfers via a virtual payment address (name@bank), QR-code based collections, mandate-based recurring debits (UPI AutoPay), UPI-Lite for small-value transactions. For broker collections, UPI is now the largest channel — clients fund their broking account via UPI in a few seconds. UPI-ASBA is the SEBI-permitted IPO / secondary-market block-funds channel. See also: Payment mandates, NPCI

UPI AutoPay

Full form: UPI Mandate (Auto-debit on UPI) Meaning: UPI-native recurring-payment mechanism allowing a payee to auto-debit a payer’s bank account periodically, up to a registered cap, on registered dates. Capped at INR 1 lakh per AutoPay (with bank-specific overrides for certain merchant categories). Simpler UX than NACH e-Mandate (single-step setup with UPI PIN / biometric, no bank-form filling). Brokers use UPI AutoPay for SIPs, recurring brokerage / DP charges, and managed-account fee debits. See also: UPI, NACH, Payment mandates

Upstreaming of client funds

Full form: — Meaning: SEBI-mandated daily process (since Apr 2023, then tightened progressively) by which brokers must transfer all client funds that are not immediately required for settlement / margin obligations upstream to the clearing corporation by end-of-day, rather than retaining them in the broker’s pooled bank account. The CC custodies the funds till they’re needed; the broker pulls back next day’s net obligation. Operational mechanics: compute the upstream amount (total client credit minus today’s required cover), execute the bank transfer to CC’s segregated account before cut-off, file daily compliance certificate. Failures trigger SEBI / exchange penalties and weigh heavily in inspection. See also: Client funds upstreaming deep dive

VAR margin

Full form: Value-at-Risk margin Meaning: A component of total margin for cash-segment equity trades — calibrated to the 99% confidence-interval daily price-move based on historical volatility. Updated weekly by the exchange (with intra-day refreshes during sharp volatility). VAR margin + Extreme-Loss Margin (ELM) together form the cash-segment margin in the absence of derivative SPAN. The VAR margin file is one of the daily inputs to broker RMS; mis-application is a recurring inspection finding. See also: RMS / SPAN methodology deep dive

VIPV

Full form: Video In-Person Verification (sometimes “Video CIP” / V-CIP) Meaning: Recorded video session where the broker representative verifies the customer’s identity by sighting the customer’s face, the original OVDs, and capturing a confirmatory statement — all over video. SEBI permanently permitted VIPV for SEBI-regulated entities via the Apr 2020 KYC technology master circular (initially as a COVID accommodation), with prescribed safeguards: geo-stamp, time-stamp, IP-stamp, randomized question, real-time recording, retention for 8+ years. Now the dominant IPV mechanism for digital onboarding. See also: IPV / VIPV section, IPV