SBAN 16-Points Recommendations to SEBON: Nepal Securities Market Reform & Development

20th June 2025, Kathmandu

The Stock Broker Association of Nepal (SBAN) has presented 16 detailed recommendations to the Securities Board of Nepal (SEBON). These suggestions were shared during a program organized by SEBON on Friday titled “Policy and Program Suggestions Collection on Securities Market and Commodity Exchange Market.” The association’s representatives actively participated and put forward their proposals aimed at strengthening Nepal’s securities market.

SBAN 16-Points Recommendations SEBON

Key Recommendations

Establish a one-stop service system to provide investors with various necessary services. The association urged expanding the scope of securities brokerage services to international standards. They also recommended easing entry barriers for investors in the secondary securities market and increasing market credibility. Additionally, they suggested allowing securities brokers to provide investment management and advisory services and removing policy and practical obstacles to fully implement margin trading.

Facilitate public access to the secondary securities market by implementing the concept of authorized representatives or sub-brokers. The expansion of the market to national and international levels should be prioritized.

Enable new investor identification and demat account opening through online and video KYC without requiring physical presence. Clear legal provisions should support online services like “Mero Share” and online trading platforms.

Introduce intraday trading, securities lending and borrowing, futures and options based on equity derivatives, and rights trading at the earliest.

Accelerate the development of the secondary bond market. The payment system should allow sellers to receive accrued interest on institutional bonds at the time of sale, similar to government savings bonds.

Introduce legal provisions allowing investors to grant power of attorney to securities brokers.

Launch an auction market promptly to compensate investors for financial losses caused by unnecessary closeouts.

Implement financial penalties when suspension of trading in listed companies or brokers’ activities causes undue harm to investors without justified reasons.

Direct NEPSE and CDSC to implement promptly the “Raf-Saf” mechanism to prevent broker suspension delays due to unresolved Raf-Saf complaints.

Enhance the quarterly financial statement format by including comprehensive information that may affect investment decisions and securities prices. Ensure timely public disclosure of such reports.

Blacklist and legally penalize investors who deliberately delay payments or securities transfers within the stipulated time.

Monitor and control undesirable activities such as insider trading, circular trading, pump and dump schemes. Maintain a list of related parties including traders, listed company shareholders, directors, employees, and their family members to be visible in the trading system for all market participants.

Make the secondary market more dynamic by encouraging participation from Non-Resident Nepalis (NRNs) and foreign institutional investors. Simplify the complicated process of repatriating proceeds and profits by coordinating with Nepal Rastra Bank.

Conduct investor awareness programs and training sessions. Provide orientation, professional development, and certification for market stakeholders, analysts, and experts. Establish a dedicated institution under the board to conduct research on new instruments, trading methods, capital markets, and the economy involving all market participants.

Regulate and supervise social media pages or platforms related to the market to control and discourage undesirable activities. Only analysts and experts certified by SEBON or NEPSE should be permitted to publicly provide securities and market price forecasts.

Transfer the Investor Protection Fund under the Company Registrar’s office to SEBON for effective management. Amend laws as needed through SEBON to address any legal hurdles.

To maintain transparency and strengthen credibility through public participation, implement reporting provisions to regulate broker proprietary trading. Also, allow brokerage firms to issue shares to the public under clear legal provisions.

These recommendations reflect the association’s commitment to enhancing market integrity, investor protection, and the overall development of Nepal’s securities market. SEBON is expected to review and incorporate these valuable suggestions into policy formulation.

For more:- SBAN Recommendations SEBON Securities