Broker companies to face huge financial blow; NEPSE adamant on its direction for brokers to setup required infrastructures

After NEPSE directed the broker companies to set up the required infrastructures to support the online trading system, it has been a matter of huge upfront investment for the broker companies. The broker companies might have to incur extra cost of about Rs 1.50 crore for the implementation of the required IT infrastructures.

The companies need to set up their own servers, data center, recovery mechanism and other hardware infrastructures in order to operate the online trading system without any difficulties. In addition, the brokerage companies will also have to hire 4 additional IT officers with years of experience to run the system smoothly.

NEPSE says that after the implementation of online trading system, the trading can be done at once from 10,000 separate devices. However, the brokers have stated that the online system’s ability to conduct trading from 10,000 devices at once is not necessary in the present context as in an average 6,000 transactions are made in the market in a single day. Some of the brokers have also alleged the stock exchange’s decision as a way to make the brokers lose a huge amount of money.

Along with that, the brokers are also in dilemma for the ways to meet the directions given by NEPSE. A broker said that they are going through discussions on the ways to meet the expenses. He further added that they are evaluating various alternatives like outsourcing or managing a single server for multiple brokers etc.

When asked about the deadline for the infrastructures to be set, Spokesperson of NEPSE, Mr. Murahari Parajuli said that deadline has not been provided on the matter. “However, the online trading system is set to come into operation from Shrawan, it would be better if the broker companies set up the infrastructures as early as possible.” added Mr. Parajuli.

In order to follow the direction of NEPSE, 50 broker companies will have to spend up to Rs 1 arba. It will be a huge financial burden for the brokers. As the discussion for the measures have been going on, it will be known in a few days what measures the brokers will adopt in order to fulfill the requirements.