The Securities and Exchange Board of India (SEBI) has given the green light to a new trading mechanism reminiscent of the ASBA model, enabling trading in the secondary market with a blocked amount. This development is rooted in the Reserve Bank of India’s (RBI) approval of a single-block-and-multiple-debit feature in UPI. The implementation of this mechanism is slated to begin on January 1, 2024, with a beta phase launch in the equity cash segment scheduled for the upcoming week.
The ‘UPI for Secondary Market’ initiative is the result of a collaborative effort involving clearing corporations, stock exchanges, depositories, stockbrokers, banks, and UPI app providers. Initially, this functionality will be limited to a select group of pilot customers. Leading the beta launch as the brokerage app is Groww, supported by UPI apps such as BHIM and YES PAY NEXT. Initially, customers of HDFC Bank and ICICI Bank will be able to avail of this service.
Several other key stakeholders, including Zerodha, Axis Bank, Yes Bank, Paytm, and PhonePe, are currently in the certification stage and are expected to join the beta launch soon.
