Product Updates

Monthly and Quarterly Payouts: The What, the How and the Why5 min read

May 11, 2023

Monthly and Quarterly Payouts: The What, the How and the Why5 min read

Want to know how the regulator has empowered all the traders? 

Want to know how you can avail instant settlements from your broker automatically? 

Read on to know more about this.

The Quarterly Settlement of Funds & Securities policy was introduced by the Securities and Exchange Board of India (SEBI) in 2009. According to this policy, w.e.f. 01-Oct-2022, your broker is required to release unutilized funds to your bank account on a monthly/quarterly basis.

Let’s first understand what settlements mean. How is it different from a withdrawal?

Settlements refer to the expected release or disbursements of funds from your broker. A settlement may be processed on an overall or periodic basis, i.e., the user may initiate it from the broker Platform or the broker might release them on a Monthly/Quarterly basis.

The amount in the settlement can either be a percentage of the client’s amount or the total amount of funds. 

However, you can withdraw your funds at any given point of time and the broker is required to settle it and disburse the same to your bank account.

Withdrawals and Settlements ideally follow the same process to release funds. But, while withdrawals are user-initiated, Settlements are broker-initiated.

As per SEBI’s guidelines, all brokers are required to settle the amount for the clients/users on the first Friday of every quarter. If the amount on the settlement day in your trading account is more than zero, it is directly credited to your primary registered bank account. This is to ensure security of the client’s account and timely reversal of the funds.

Let’s understand these settlements in depth:

1. When Can You Expect Your Next Payment from Your Broker?

  • If the amount is more than zero, and you have not traded within a month (30 days), you will receive your settlement as a part of the monthly settlement, which is scheduled for the first Friday of every month.
  • If the first Friday of the quarter is a trading holiday, then this settlement will be executed on the previous trading day.
  • All accrual/brokerage charges will be retained by the broker platform as a part of this settlement.

2. What Can You Do to Ensure Your Settlement Is Processed on Time?

For a smooth settlement, you are required to ensure correct primary bank details are updated on the broker’s platform. It is critical to note that the broker will initiate your settlement in the Default bank, hence making it all the more important to ensure the Default bank details are kept in check and updated.

3. What to Look Out for After the Settlement Is Processed?

  • A detailed Quarterly report of all the transactions is sent to your registered mail, to account for all the activity in the last 90 days.
  • It is essential to note that, post the settlement, since your trading balance would be zero (excluding the margins). You need to add funds back timely to the account, to resume usual trading from the next Monday onwards.

4. Didn’t Receive the Amount in Your Account? Here Are the Possible Reasons:


Your broker can hold a margin against recent open positions. A margin of an additional 125% is retained as a part of this settlement against any EOD margin requirement.

This 125% will be an addition to the 100% value of the portfolio (open positions), amounting to a total of 225%.
For instance, you have Rs 25,000/- available in your trading account and have open positions(F&O or Equity) worth 10,000/-. Your broker needs to maintain a margin of Rs 22,500/-(10,000*225%). 

Your broker is liable to settle only the remaining amount of Rs 2,500/-.

In another instance, let’s say, you only have Rs 15,000/- available in your trading account and have open positions(F&O or Equity) worth 10,000/-. Your broker needs to maintain a margin of Rs 22,500/-(10,000*225%). 

Your broker is not liable to settle any amount to your bank account.

It is important to note that no margin is marked in case of delivery investments and the broker should release the balance amount.

Error on the User’s end

Update primary bank account details. In case the account details are not updated, this might result in transaction failure, on account of account frozen/blocked.

IFSC mismatch/invalid

In this scenario, there is a risk that your money might land in another account, which does not even belong to you. Please ensure this is updated at all times.

Balance less than ₹1

In case your trading account has a balance of less than Re 1/-, some banks(PSU and others) may not allow the settlement to be processed. In this scenario, a settlement would be initiated from the broker’s end and the failure reason will be published to you.

Service Down

Your bank services might be down during the settlement window. In this scenario, the broker initiates a retry for the reversal of funds.

5. Quarterly Settlement Schedule – 2024*

* – In case a Public holiday is observed on the planned date, the settlement shall be initiated on the previous working day.

Paytm Money adheres to all the SEBI guidelines and ensures timely settlement of the trader’s funds. We will notify you on the application, and send out an email confirmation too!

Lookout for the next settlement of funds and detailed quarterly report generated for your portfolio – directly sent to your registered email!

Disclaimer: Investments in the securities market are subject to market risks, read all the related documents carefully before investing. The securities are quoted as an example and not as a recommendation. This content is purely for information purpose only and in no way to be considered as an advice or recommendation. Paytm Money Ltd SEBI Reg No. Broking – INZ000240532. NSE (90165), BSE(6707) Regd Office: 136, 1st Floor, Devika Tower, Nehru Place, Delhi – 110019. For complete Terms & Conditions and Disclaimers visit:

Authored by : Vinny Akkal | Product Manager – Paytm Money Ltd.