OTC exchange of India (OTCEI)

OTC exchange of India (OTCEI) is recognized as a stock exchange under Section 4 of the Securities Contracts Regulation Act, 1956. It was established to aid enterprising promoters in raising finance for new projects in a cost effective manner and to provide investors with a transparent and efficient mode of trading.

OTCEI is the first screen based nationwide stock exchange in the country, the first exchange to introduce Market Making in India, and the first to introduce sponsorship of companies in India. It was also the first exchange in the country to open Investor Grievance Cells (IGCs) at four Metros: Chennai, Delhi, Kolkata and Mumbai.

OTCEI is the only exchange to allow companies with less than three-year track record to tap capital market. It has entered into an agreement with NSCCL (National Securities Clearing Corporation Limited) to provide efficient clearing and settlement systems.

The Exchange has three different types of intermediaries known as Members, Dealers and Sponsors. Members and Dealers may carry out the activities of trading, underwriting, market making and participation in bought out deals. Sponsors can perform the function of sponsorship of issues, however they are not permitted to participate in secondary market activities. The Exchange has an online monitoring and surveillance system, through which exposure of Members/Dealers is monitored on a real time basis.

The main advantages of trading on OTCEI are: Low transaction costs; Nationwide trading; Demat trading facility; Dissemination of information through monthly bulletin; Greater liquidity through hybrid trading (market making and order book system).

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Kelvin Wong Loke Yuen is an experienced writer with a strong background in finance, specializing in the creation of informative and engaging content on topics such as investment strategies, financial ratio analysis, and more. With years of experience in both financial writing and education, Kelvin is adept at translating complex financial concepts into clear, accessible language for a wide range of audiences. Follow him on: LinkedIn.

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