Future and options traders using Zerodha, one of the largest online-brokerage firms, faced technical issues between 10 am and 10.40 am on 29 August.
Soon after, the retail broker tweeted about it.
The glitch led to users unable to place any trades on the day of expiry, which led to them facing mark-to-market losses. Many took to Twitter to express their displeasure and tweets with the company hashtags were trending. One user asked for penalizing the company.
People were sharing screenshots of their mark-to-market (MTM) losses and were holding the broker responsible for compensation. But client contracts, based on SEBI model agreement, might exempt the company from any such liability.
The founder was quick respond to the daily that "Nobody can guarantee a 100 percent up time…"
The overload on their order management system (OMS) was pointed out in a post by the company apologizing and explaining that there was no way to predict or control large single orders that caused the overload. To combat the issue they also limited the maximum allowed quantity per order to 20,000 for equity trades.
Some investors also suggested the company to increase their brokerage to deploy better technology. To which the founder has assured that technology and quality of their products are something that they never compromise on.
Nithin Kamat has also stated in the post that the online broker will now launch basket orders on their online trading platform, Kite, to ensure that technical issues do not arise because of large orders.
This is not the first time such an issue has risen with the broker. On 27 February, OMS had faced a technical glitch leaving investors miffed. But according to a report by Mint, the broker is not liable to compensate investors who couldn’t take a position online due to a system failure.
Reports suggest that Zerodha had 9.09 lakh active clients as of July 2019 end which makes it the largest retail broker.
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