SEBI issues norms for Mobile trading
Keeping up with the innovations in the mobile platform, SEBI has now issued a draft model to enable stock trading via mobile phones. This draft model when accepted would allow mobile users to initiate trading on their cell phones in a huge way.
SEBI guidelines already allows Internet trading through web sites and trading terminals provided by brokers. Almost all big brokers like ICICI Direct, Sharekhan, India infoline, Reliance Money currently provide internet platform for trading and internet stock trading has been a huge success in India.
According to SEBI’s proposed framework, brokers providing Internet-based trading services will be eligible to use wireless technology for the same. SEBI has also invited market participant’s view by June 15. The guidelines also shows SEBI’s seriousness to implement this action as it also lays a lot of emphasis on user identification, network access control and network security, requiring brokers to maintain adequate back up systems and data storage capacity.
The growth of Internet and mobile trading definitely helps in bolstering broker’s net income as they have to shell out less money on human resources. Although it also leads to higher costs in terms of customer care services as well as in technology up gradation but benefits out weighs initial costs.
What more can be done?
Reliance money earlier brought Internet trading to the masses by launching internet trading terminals across India following ATM approach. It also launched Mobile trading a few months ago leveraging its sister telecommunication arm. Many brokers have been emphasizing on Mobile trading through low down version of their site but what is clearly missing is a dedicated mobile trading platform. The increase in Smartphone sales can definitely cater to better mobile trading platforms.
SEBI can also invite companies like Financial technologies, maker of many popular terminals to leverage their expertise on mobile platform. At the same time it also needs to boost internet trading which right now constitutes a very miniscule percentage of trades. The confidence of trading users can also be boosted by providing new technologies such as ‘Security Token’ for mobile and internet trades, which is currently employed by Reliance money. The introduction of mobile trading looks set to capture the high growth witnessed in telecom for Financial markets in India.
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