Bse To Reactivate The Practice Of Remesiery Deals

In a move to help the investing public, the Bombay Stock Exchange (BSE) has decided to revive the practice of remesiery dealings. The remesier (who acts as the agent of the broker) will be engaged by member-brokers to get business in securities on a commission basis. The exchange has now finalised the application form and other formalities for the registration of remesiers.

In a circular issued to members late last evening, BSE has said that members had expressed difficulty of doing business through sub-brokers, specially since Sebi had called for registration of sub-brokers. Coupled to it was the additional burden of the broker being made responsible for the trades with the sub-broker and pending investor grievances.

 

All the major bourses are now adopting different ways to ensure safety at the markets. While the NSE is seeking to ensure that dealers take up complete responsibility of their sub-brokers, BSE is moving ahead with its plan for appointing remesiers.

At an annual meeting of SEs held in March, the market regulator said that it would take steps to revive the concept of a remesier. Though the remesier is registered with an exchange, he is not authorised to issue contract notes or confirmation note to the client. A contract is to be issued only by the broker who alone would take responsibility for the deal.

BSE president M G Damani said, "It is time for the members to increase the availability of their services to the investing public. It is in our interest that the contacts of the members of the exchange should reach a wider horizon of investors throughout the country.''

According to the BSE top brass, with screen-based trading and computerisation of brokers' back-offices, manual work has been reduced considerably over the past two years. The constraints which compelled members to refuse more clients do not exist anymore.

Investors now want to deal directly with brokers, and with brokerage rates coming down, brokers need more business to break even, sources said.

The BSE president expressed faith in the development of the chain of remesiers which, while serving a larger section of investors directly, would enhance the credibility of the members.