The world is turning flat. The world of brokerages, that is. In what seems like a preemptive move to counter R Trade’s promise of very low brokerage fees, online trading portals Kotak Securities and ICICI Direct are offering plans under which clients will be charged a flat amount instead of the usual percentage.
Kotak Securities has two plans on offer under the Kotak Flat structure. One charges Rs 9 per transaction and comes at a monthly fee of Rs 499. But this is only for delivery-based deals of up to Rs 5,000 and intra-day trading up to Rs 50,000. Exceed this limit and you will need to pay another Rs 9, which pushes up the effective brokerage rate. The second plan charges Rs 20 a trade but no monthly fee. Opt for the latter if you don’t trade frequently or trade low volumes.
ICICI Direct’s Clear Value Deal has monthly fees of Rs 299, Rs 599 and Rs 999 which entitle you to trading worth Rs 1.5 lakh, Rs 3 lakh and Rs 6 lakh respectively every quarter. If you exceed the limit, the excess would be charged at the regular 0.75%.
Who would win this rate war? Right now, it seems the real winner would be the small investor whose transaction costs will come down with the introduction of the flat brokerage structure.
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today