The Securities Board of Nepal (SEBON) has enforced a new regulation requiring stock brokerage firms to increase their paid-up capital by ten times or merge with similar companies. The Stockbroker Merger Directive, recently approved by SEBON, mandates that brokerage companies raise their paid-up capital from Rs 20 million to Rs 200 million.
Although SEBON had initially decided on this capital increase in August 2022, the policy has only recently been officially implemented. While newly licensed brokerage firms already meet the requirement, many older firms have yet to comply. Of the 90 brokerage firms in Nepal, SEBON had issued licenses to 50 firms before 2009. Among these, only 22 have met the new capital threshold, while the remaining 28 must either increase their capital base or merge with other firms to continue operations.
