Branch2 Intelligence

Depositories get to spend 5% of IPF interest income

IN · 2026-07-08

Key takeaway

SEBI allows depositories to spend 5% of IPF interest income on admin costs, freeing up cash flow.

Step 1SEBI permits 5% of IPF interest income to be used for admin expenses.
Step 2Depositories (NSDL, CDSL) recognize incremental annual income, improving operating margins.
Step 3Increased profitability and reinvestment capacity strengthen depositories' competitive positioning and ability to invest in technology.
Step 4Custodian banks (e.g., HDFC Bank) benefit from higher depository transaction volumes as market activity grows.

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