Franchise

Sub Brokers / Authorized Person / Sub Broker Franchise Review

A sub broker is an individual chosen by a stock broker who acts as an agent on behalf of a Trading Member but is not a Trading Member of a Stock Exchange. This article will teach you everything you need to know about Sub Brokers / Authorized Person / Stock Broking Franchise or Sub Broker Franchise.

A sub broker is also known as a broking franchise. Sub-brokers must be registered with SEBI, and the stock broker will be held accountable for all authorized person commission tasks.

A sub broker is also known as a broker’s agent. A broker may contact a sub broker who has a large client base in order to reach out to more people. The Securities and Exchange Board of India (SEBI) requires sub brokers to be registered. SEBI made it a requirement that no trading member associate with a sub broker who is not listed with it.

A broker can, in general, have several sub brokers working for him. There is no limit to the number of sub brokers a stockbroker may have.

What does a sub broker do?

An Authorized Person or Sub Broker is a type of system in which any SEBI registered Stock Broker can deliver its franchise to any firm or individual who is willing to abide by all SEBI rules and regulations and has a strong network of investors to act as a sub broker on the franchiser’s behalf.

The franchisee provides the same products, services, offers, and so on as the franchiser. Aside from that, the Franchisee can offer additional benefits to their clients that the Franchiser does not. This company uses the brokerage sharing model, in which the franchisee keeps the majority of the profits and the franchiser receives a small portion.

What do you mean by a Share Market Sub Broker or Stock Broker Partner?

A Stock Market Sub broker or Stock broker partner is a franchisee company that manages the franchiser’s stock broking franchise.  Angel Broking, Nirmal Bang, Share Khan, and others are among the leading Stock Broking Franchisers.

A Sub broker or partner’s primary responsibility is to provide stock tips or stock recommendations to clients based on his evaluation of the industry. Some franchisees make stock recommendations to their sub brokers, but the vast majorities do not.

Sub Brokers or partners keep track of their clients and it is their responsibility to get their clients to trade so that they can earn high commissions.

Sub Broker Regulations

The Securities and Exchange Board of India (Stock-brokers and Sub-brokers) Regulations, 1992 have been amended by SEBI. The Securities and Exchange Board of India (Stock-brokers and Sub-brokers – 2nd Amendment) Regulations 2018 replaced these regulations.

They became effective on April 1, 2019. According to this amendment, SEBI now allows sub brokers of stock and commodity exchanges to conduct commercial activities under a single entity. Previously, it was permitted to be performed under different companies.

According to the regulations, the sub broker is responsible for submitting deceptive or false return percentage values to the stock exchange. They owe it to themselves to follow procedures and file returns on time. Even more so, according to

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