Kathmandu. KATHMANDU: The Securities Board of Nepal (SEBON) has published a draft regulation on margin lending and sought suggestions from stakeholders.

Although there is institutional development, electronic trading system and expansion of investor base in Nepal’s capital market, it is necessary to make the market more modern, competitive and in line with the international practices. In line with this objective, the Board has moved ahead with the implementation of margin lending, intraday transactions, securities lending and credit and covered short selling system.

The Board has prepared a draft of the Margin Credit Transaction Regulations with the objective of implementing the margin lending system in the first phase. According to the Board, through this provision, the eligible investors can take loan from securities brokers along with their own capital and invest in securities.

The draft with necessary revisions was made public for public consultation after holding discussions in a committee comprising representatives of Nepal Stock Exchange Limited, CDS and Clearing Limited and Stock Brokers Association of Nepal.

The Board has said that it will finalize the regulations after studying the feedback and suggestions received from the stakeholders. The Board has also urged all sides concerned to provide their important comments and suggestions on the draft.

A brief description of the public consultation, salient features and questions prepared for the recommendations can be viewed through the relevant materials and links provided by the Board.