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Clearing Member

Updated on July 18, 2023

A clearing member refers to a member of a Clearing Corporation who is responsible for clearing and settling transactions through the Clearing Corporation. They carry out the clearing and settlement process for a specific segment, following the prescribed terms, conditions, and procedures set by the Clearing Corporation.

Who can be clearing members in different markets?

In the Capital Market Segment, all trading members of the Exchange are required to become clearing members of the Clearing Corporation. This means that they must handle the clearing and settlement of their own transactions and those of their clients, adhering to the rules and regulations established by the Clearing Corporation.

However, in the Futures and Options (F&O) Segment, trading members have the option to select a different clearing member or a professional clearing member to handle the clearing and settlement of their trades. It is not mandatory for trading members to clear their own deals in this segment. Trading members who are also clearing members have the ability to clear and settle their own transactions as well as transactions of other trading members who choose to use their services.

On the other hand, “Self Clearing Members” are clearing members who can only clear and settle their own proprietary trades and the trades of their clients. They are not permitted to clear and settle transactions for other trading members.