What are clearing charges, and is there any at Zerodha?
A clearing charge is paid by traders to settle their trade through a clearing agency. The clearing process is a back-end process that determines a broker’s fund and securities obligation and settles them with the exchanges through the clearing mechanism. It ensures the easy settlement of trades with the broking houses and the exchanges.
A broker can either self-clear the trades or assign the task of clearing to a Professional Clearing Member (PCM). Since Zerodha is a self-clearing member, it does not levy any clearing charges to its customers. Brokers who require third-party clearing members to clear the trades charge between ₹200 to ₹2,000 per crore or between 0.002% to 0.02% of the option premium.
To put this in perspective, on an intraday basis, the Nifty option can be bought and sold at ₹100 (premium), 10 times during the session. The premium turnover, in this case, is ₹15 lakhs. The clearing charges with other brokers can vary between ₹30 to ₹300.
Did you know?
Clients may not find clearing charges under a separate heading in the contract note of some brokers. Please check if clearing charges have been combined with exchange transaction charges or charged for different segments, including physical delivery.