Buy-side margin relief on cards as Sebi looks to lift cash market turnover

Sebi is considering waiving upfront margins on buy trades funded by same-day sale proceeds under the early pay-in (EPI) mechanism, a move that could boost cash market liquidity and turnover. Currently, even after using EPI to sell shares, investors face about 20% upfront margin blocking by brokers on immediate re-deployment of sale proceeds. The proposal, discussed at Sebi's Risk Management Review Committee, is preliminary and aims to allow smaller brokers to offer EPI facilities, encouraging greater participation in the cash segment amid concerns over excessive derivatives activity.