SEBON Proposes Extension for Broker Companies to Meet Minimum Capital Requirement

The Securities Board of Nepal (SEBON) has submitted a proposal to the Ministry of Finance to amend the "Securities Businessperson (Broker and Dealer) Regulations, 2007" in order to extend the deadline for broker companies to meet the revised minimum paid-up capital requirements.

The proposal was approved during SEBON's board meeting held on Friday, aiming to provide additional time for broker companies to comply with the updated capital mandates.

Under the current provisions, broker companies are required to maintain a minimum paid-up capital ranging from NPR 200 million to NPR 600 million, depending on their classification. Similarly, stock dealer companies must maintain a minimum capital of NPR 1.5 billion.

Previously in Bhadra 2079 (August/September 2022), the government and SEBON amended the regulations and significantly increased the minimum capital requirement—up to 30 times more than before. However, most broker companies have struggled to meet the new capital levels within the given timeframe. As a result, SEBON is now seeking to extend the deadline until the end of Chaitra (mid-April).

Currently, out of 90 registered broker companies in the market, only two are operating as full-fledged brokers, while the remaining 88 provide limited brokerage services.