Who Keeps F\&O Margin Interest? Delhi HC to Hear Key Case

The Delhi High Court is set to hear a significant case that could impact millions of Indian investors trading in Futures & Options (F\&O). At the heart of the matter lies a critical question: who is entitled to the interest earned on margin money that traders deposit with brokers?

Several investor petitions allege that stockbrokers retain the interest accrued on these margins—held in pooled accounts—without passing the benefit to clients. Petitioners argue this practice lacks transparency and may violate investor protection norms set by market regulator SEBI.

The court’s intervention comes amid rising participation in derivatives trading, with retail investors increasingly active in the segment. If the judgment favors investors, it could set a precedent requiring brokers to share interest earnings or restructure their margin handling practices.

Legal experts suggest the case could lead to regulatory reforms and more clarity on fiduciary responsibility in client-broker relationships.

The next hearing is scheduled in the coming weeks. Market participants, investor groups, and brokers alike are closely watching the outcome.