Shouldn’t transaction costs drop significantly after a decade of automation? NSE cannot even attribute it to higher employee costs, which are an insignificant Rs 20 crore. NSDL with its 90 per cent market share manages to remain hugely profitable, even after using its infrastructure to subsidize the less profitable Tax Information Network. That could change dramatically if Sebi’s disgorgement order is implemented.

Although retail investors have been protesting high demat charges for several years, the institution has made little effort to reduce the burden. In a fully automated trading environment, the inadequacy of Depository Participants around the country is stunting retail investor growth. Here again, the regulator has abdicated responsibility by leaving costs and charges to the discretion of these near monopoly institutions.