Small stockbrokers will soon shift their clearing, settlement and custody functions to EClear Services Ltd, which is the country’s first professional clearing member (PCM) entity set up by the Central Depository Company (CDC).
Speaking to Dawn on Wednesday, EClear Services Ltd CEO Shariq Naseem said more than two dozen trading-only brokers have signed up for the company’s services.
The clearing function in a stock market relates to the settlement of trades. A clearing member is supposed to match buy and sell orders and transfer money to the seller while moving shares to the buyer.
According to the new broker regime introduced by the Securities and Exchange Commission of Pakistan (SECP), stockbrokers have been categorised into three segments. Brokers in the first category are allowed to do trading and clearing while keeping shares in their custody. They can also provide clearing and custodial services to other brokers.