FMC gives freedom to exchanges to fix different transaction fee

To boost trading volumes in the commodity futures market, the Forward Markets Commission (FMC) has tweaked the previous directive to allow national-level exchanges to charge different transaction charges for different commodities' contracts and even in the case of contracts of the same commodity.

The FMC said the exchanges should ensure the ratio between the highest to lowest transaction charge in the turnover slab of any contract should not be more than 1.5:1. In the slab system, the concessional transactional charges should be charged only on the incremental turnover and not on the entire turnover, it added. The FMC has directed the bourses to make the necessary changes to their by-laws and file the compliance report by Wednesday. On February 13, the regulator had issued a directive allowing exchanges to charge fee based on delivery and non-delivery based contracts.

Currently, the Multi Commodity Exchange charges a transaction fee of Rs 2.5 for every Rs 1,00,000 of turnover for brokers generating a monthly average daily traded value of Rs 250 crore. Whereas the agri-commodity bourse National Commodity and Derivatives Exchange has recently reduced the fee sharply for non-delivery based contracts of gold and silver to Rs 0.4 from Rs 2 for every Rs 1,00,000 of turnover up to ADTV of Rs 50 crore.

For delivery-based contracts, the NCDEX has reduced the fee to Rs 1.95 from Rs 2, for every Rs 1 lakh of turnover for brokers generating a monthly ADTV of up to Rs 200 crore.