The National Stock Exchange of India Limited (NSE) has warned that stock brokers are not permitted to distribute or offer banking loan products—such as home loans, vehicle loans, personal loans, education loans or loans against securities, even if they are registered as research analysts. NSE noted that some trading members who are also registered research analysts were distributing banking loan products, prompting the reiteration.
NSE, in a circular issued today, said trading members must strictly follow its June 16, 2025 framework on distribution of third-party products. Under this framework, brokers may engage only in lending products expressly permitted by SEBI, including margin trading facility (MTF) and T+1+5 funding, and no other loan products. Circular said “it is reiterated that Stock Brokers are not permitted to engage (as distributors) in any lending products (such as Home Loan, Vehicle Loan, Personal Loan, Education Loan, LAS etc.) other than those specifically permitted by SEBI from time to time”.
The exchange said, “It has been observed that the trading members, who are also registered as research analysts, are carrying out distribution of Banking Products related to various types of loans”.
The clarification follows Securities and Exchange Board of India FAQs issued in July 2025 on research analyst regulations, which allow research analysts to distribute non-SEBI products (such as banking products) only at a family or group level, with grievances outside SEBI’s purview.
NSE emphasised that the exchange’s broker framework prevails for trading members, regardless of their additional registrations, and directed members to ensure strict compliance. Non-adherence could invite regulatory action, the exchange warned.
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