What is Quarterly Settlement/Running Account Settlement?
SEBI mandates stockbrokers to settle (transfer available credit balance from Trading account to Bank account) the client’s funds lying in the trading accounts at least once in a quarter (90 days) or 30 days, depending upon the choice of the client. This process of transferring unused funds back is called ‘Running Account Settlement’ or ‘Quarterly Settlement of funds’.The funds are transferred back to the primary bank account mapped to your Zerodha account.
Recently, SEBI made changes in the way funds are settled, mandating that all brokers transfer back funds to the client’s account in 3 days if there have been no trades in the client’s account for a period of 30 days. This is despite the client having chosen the ‘90-day’ settlement cycle. This means that if you haven’t traded continuously for 30 days in any segment, the funds will be transferred back to your account in the next 3 days.
a. If your free cash was Rs 10000/- on August 1st and you haven’t traded the entire month until 30th, your entire funds of Rs 10000/- will be transferred back to your bank account within Sept 02nd.
b. If your free cash was Rs 10000/- on August 1st and you have not traded and have just made additional transfers on Aug 25th, your funds will be transferred back to your bank account within September 02.
If you hold any open F&O position, an additional 125% margin can be blocked, and any balance amount will be sent to your bank account.
You can check the tentative dates of your next quarterly settlement on the Funds page on Console.
Note: Effective 1st September 2020, quarterly settlement of pledged holdings is no longer required since the stocks are pledged via the margin pledge system.