What happens if I don't maintain the required cash component?

What happens if I don't maintain the required cash component?

In case of deficiency in the cash components, interest will be levied at the rate of 1% per month for shortfall amount. It's important to maintain the required cash components to avoid incurring these charges.


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    • How can I avoid paying interest on cash component deficiency?

      To avoid interest charges, ensure that you maintain the required 50% of the margin as cash component. You can also consider maintaining a higher percentage of cash component to provide a buffer against any potential deficiencies.

    • Do I need to maintain 50% ratio in the form of cash or cash equivalent collateral?

      Yes. You are required to maintain a minimum of 50% of the margin in the form of cash component, along with other non-cash component collateral such as stocks, securities, etc.

    • Is there any flexibility in the cash component requirement?

      While the minimum requirement is 50% of the margin, you can choose to maintain a higher percentage of cash component to avoid potential deficiencies and interest charges. Illustrative table appended below considering various scenarios: Scenario ...

    • Can I use the full margin of cash components?

      The collateral margin received by pledging cash component securities can be used fully towards any margin requirement for your open positions. There is no requirement to maintain cash separately if the margin requirement is covered by collateral from ...

    • What are cash components?

      Cash component is the margin which is considered as a cash or cash equivalent. Examples: Cash transferred from your Bank LIQUIDBEES ( NIP IND ETF LIQUID BEES ) ICICILIQ ( ICICIPRAMC - ICICILIQ ) LICNETFGSC ( LICNAMC - LICNMFET ) LIQUIDETF (DSPAMC - ...