The Brokers’ Industry Standards Forum (ISF) is working on a proposal to simplify and consolidate multiple documentation and reporting requirements for stock brokers, in a move aimed at improving operational efficiency and ease of doing business, according to sources aware of the discussions.
The proposal, currently under discussion within the ISF, will be presented to the Securities and Exchange Board of India (SEBI) after internal deliberations are completed.
The idea of merging multiple broker-side documents, particularly those related to margin reporting and collateral usage, into a single, standardised framework, a source said.
Currently, brokers are required to comply with a layered documentation and reporting structure. A key component is the MG13 file, which forms part of the client-level margin reporting system mandated by exchanges. This file captures margin obligations for each client and requires brokers to report the actual margin collected against exchange-prescribed requirements on a periodic basis.
In addition to margin reporting, brokers must maintain separate collateral-related documentation. This includes client authorisations for pledging securities with clearing corporations or clearing members, as well as detailed records of collateral received, applicable haircuts and utilisation. Regulatory norms also require that client collateral be used strictly for meeting that client’s margin obligations, with full audit trails maintained.
Market participants said these processes often involve overlapping data points, such as client-level margin details, collateral value, and utilisation permissions, but are maintained across multiple formats and systems.
“The same information gets captured across different documents, including margin files, pledge authorisations and internal records. The effort now is to see if these can be standardised into one integrated framework,” a person familiar with the discussions said.
While SEBI recently undertook a comprehensive overhaul of stock broker regulations to simplify and rationalise the broader compliance framework, it left out operational-level documentation such as margin reporting formats or collateral authorisations. Instead, the regulator indicated that such procedural aspects could be standardised separately through circulars and industry-led efforts, including via the ISF.
Market participants said that the documentation required at the time of client onboarding is already extensive. Brokers have to maintain a comprehensive set of records, including KYC forms, rights and obligations documents, risk disclosure statements, and policy disclosures, in addition to ongoing reporting requirements.
“The multiplicity of forms increases compliance costs, slows down onboarding and creates operational risks such as inconsistencies or errors in reporting,” said an industry source.
The ISF, which includes representatives from stock exchanges, clearing corporations, and leading brokerage houses, is examining whether a unified template can capture margin reporting, collateral authorisation and related disclosures without diluting regulatory safeguards.
While the proposal is still under discussion, there is broad agreement within the industry on the need for rationalisation. Once finalised, the framework will be submitted to SEBI for consideration.
SEBI did not respond to a request for comments.
Published on April 12, 2026
