Checking a broker for currency derivatives
SEBI registration, exchange membership and the currency segment
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SEBI registration, exchange membership and the currency segment
This is the India version of the lesson. Indian residents may trade currencies only through exchange-traded currency derivatives on NSE, BSE or MSE, with a SEBI-registered broker. Education only, no tips.
Your broker is not your counterparty
On an Indian exchange the broker is a member that passes your order to the exchange. The trade is matched against another participant and guaranteed by the exchange’s clearing corporation. The broker does not take the other side of your trade, which is the opposite of how an offshore forex dealer works.
Three things to verify
Before you open an account for currency derivatives, check three facts, all on official websites (as of 3 November 2026):
Where your money sits
Margins for exchange trades are reported to the exchange and the clearing corporation, and SEBI rules require brokers to settle client funds back to clients periodically rather than hold them indefinitely. Contract notes come from the broker for every trading day, and the exchange sends its own trade confirmation by email or SMS — so you can check that what the broker shows you matches what the exchange recorded.
What a broker may not do
A SEBI-registered broker is not an investment adviser unless it is also registered as one. Tips, “calls” or guaranteed-return schemes from a broker’s staff or from an affiliated influencer are a reason to complain, not to trade. Compare brokers on facts: registration, segments, charges, the trading platform and the quality of support.
You’ve mastered: checking a broker
On an Indian exchange the broker routes your order; the clearing corporation guarantees the trade
Verify SEBI registration, exchange membership and the currency segment on official sites
A foreign licence does not make an offshore broker lawful for residents
Brokers are not advisers: ignore tips and return promises