Query Regarding Funds Safety and Wallet Usage for Trading

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1

Dear Dhan Team,

I am a serious trader and investor, actively involved in:

  • Intraday trading on equities and F&O.
  • Swing trading on equities.
  • Long-term investments.
  • BTST (Buy Today, Sell Tomorrow) and commodities trading.

I typically keep significant amounts of funds ranging from ₹50 lakhs to ₹2-5 crores in my trading wallet. I rely on these funds for executing multiple trades, triggers, and strategies that require liquidity.

Previously, I used Zerodha for over 8 years and trusted their platform for trading and investments. I have recently switched to Dhan due to the features you offer, which are promising.

However, I have a few concerns, and I would appreciate your guidance on the following:

  1. Safety of Funds: In case of broker default, what protection do I have for the money kept in the Dhan wallet? I want to ensure that my funds, which are essentially my life savings, are safe.
  2. Wallet System: Could you explain how the wallet system at Dhan works? Specifically, how are my funds held, and what measures are in place to safeguard them?
  3. Regulatory Protections: Are there any relevant SEBI regulations, circulars, or articles that outline the protection of investor funds in case of a broker default? Please provide any information regarding insurance or other safeguards for large amounts of money stored in trading accounts.

I trust your platform and hope to continue using Dhan, but I want to ensure my funds are fully protected while engaging in various trading strategies. Your guidance will help me make an informed decision.

Thank you for your support.

Best regards,
NITKARSH SANTOSH CHOURASIA

2

Hi @NitkarshChourasia Welcome to MadeForTrade community.

All stock broking platforms including Dhan and any other are strictly regulated by SEBI and the guidelines that are prescribed by Exchanges, Depositories, Clearing Corp and KRA authorities from time to time. Indian markets are possibly the strongest when it comes to investor protection.

Dhan has over 7,25,000+ active users on its platform, over 85% of them have moved from other platforms to Dhan. We cater to super traders / long term investors, many trading & investing significantly high volumes / value with us.

Our teams are available for assistance on help@dhan.co if you have any queries. Hope this helps.

3

Thank you for the response. Could you please provide a link to any SEBI circulars or other regulatory guidelines? I would like to better understand how the investor protection mechanism works in detail.

Hope you understand my concerns. Thank you again for your assistance.
@PravinJ

4

@PravinJ – I was hoping to get some information about it. Could you provide a few facts?

Also, is there anything related to circular references or similar topics that you could share?

Thank you!

5

Besides a good part of the free cash in your account could be parked with liquid funds which means units of this funds stay in your demat account. Then u can pledge these for getting cash equivalent collateral for trading. What is in demat account stays in the demat account even if the broker goes bust.

Besides Dhan is a broker that can be trusted.