Leading agri-commodity bourse NCDEX has lowered the transaction fee for members, a move aimed at boosting trade volumes in non-agricultural items.
In a circular issued last week, NCDEX said with effect from May 6, 2011, members would have to pay a transaction charge of Rs 2 per Rs 1,00,000 of turnover if their average daily business is within Rs 100 crore (Rs 1 billion).
Transaction fee of an exchange is paid by members and is calculated at the rate of every Rs 1,00,000 of business and on the basis of their daily turnover on the bourse.
According to the circular, members of NCDEX would have to pay Re 1 if their average daily business is between Rs 100 crore (Rs 1 billion) and Rs 200 crore (Rs 2 billion).
Members would have to pay 50 paise if their daily turnover exceeds Rs 200 crore (Rs 2 billion).
Currently, members of NCDEX pay Rs 4 for daily turnover up to Rs 20 crore (Rs 200 million), Rs 3 for turnover between Rs 20 crore (Rs 200 million) and Rs 50 crore (Rs 500 million), Rs 2 for turnover between Rs 50 crore (Rs 500 million) and Rs 125 crore (Rs 1.25 billion) and Re 1 for more than Rs 125 crore (Rs 1.25 billion).
Experts said the reduction in transaction fee for members trading at the NCDEX platform would encourage business volumes in non-agricultural items like bullion, crude oil and metals.
NCDEX has been trying to reduce transaction charges on its platform since the time its rival MCX had cut the fee in October, 2009.
In 2009, Commodity markets regulator FMC had disapproved NCDEX' proposal to reduce transaction fee to 5 paise for every Rs 1,00,000 turnover in the evening session.
According to the FMC guidelines, commodity bourses can charge a maximum of Rs 4 and a minimum of Re 1 for every Rs 1,00,000 turnover.
"The exchanges should not change the fee structure arbitrarily," Khatua had then said. At present, members of MCX pay Rs 2.50 for daily turnover up to Rs 250 crore (Rs 2.5 billion), Rs 1.25 for a turnover between Rs 250 crore (Rs 2.5 billion) and Rs 1,000 crore (Rs 10 billion) and Rs 2 for a daily business of more than Rs 1,000 crore (Rs 10 billion).
NCDEX made business of Rs 56,923 crore (Rs 569.23 billion) in the first fortnight of April, 2011, while MCX clocked a turnover of Rs 5,18,986 crore (Rs 5189.86 billion) in the same period.
