Anil Singhvi reveals why Sebi is on right path regarding compensation for losses of traders, investors from tech glitches

In a heartening news for traders and investors, market regulator Securities Exchange Board of India (SEBI) has decided to bring laws to compensate for losses borne by them due to technical glitches.  

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Speaking on the subject, Zee Business Managing Editor Anil Singhvi said it is a welcome step. " It is good that SEBI has taken cognizance of the matter and there should be a framework related to these problems. I strongly feel that losses incurred by investors due to technical glitches by discount brokers or even full-time brokers should be compensated in any which manner possible," Market Guru said.    

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He also said discount brokers would be careful in future because this has become a regular phenomenon with them. "Every time there is crucial moment in stock market, these brokerages start facing system upgradation issue. This shouldn't keep happening further. If they can't manage their system, they should surrender their brokerage cards as customers and clients won't suffer losses because they fail to manage their system. I am very happy that SEBI is going to draft a framework on this issue."  

It will be interesting to see how this framework will be drafted, what will be content, how customers will be compensated and how brokerage houses will be made accountable, he said. "This is not an easy job but an initiative should be taken. This is a big step taken by SEBI to boost confidence of traders and investors in the market. I would like to thank SEBI from my heart that it took note of this matter. This is a job of a proactive regulator. SEBI has taken the right decision. This is what exactly should happen."  

He further said even exchanges should make a framework that either it is them or brokerages behind such glitches and rights of traders and investors should be clearly spelled out in such a scenario.  

He also told investors that they should also know that these guidelines are not to be misused. They should claim only when there is actual loss to them and not just for the sake of it. "There should be a balance," the Market Guru concluded.