NSE to introduce rollover facility in SLB from tomorrow

In a bid to increase participation in the stock lending and borrowing (SLB) market, National Stock Exchange will introduce the rollover facility under this facility from tomorrow.

SLB mechanism allows short sellers to borrow securities for making delivery.

The rollover facility in the SLB session will be available for a three-month period (original contract plus two rollover contracts).

Under the rollover facility, lenders of securities would be allowed to extend an existing position. It means that lenders who are due to receive securities can now extend the period of lending.

Similarly, a borrower who has to return borrowed securities can extend the period of borrowing.

"...rollover in Securities Lending and Borrowing Scheme shall be introduced from May 26, 2015," NSE said in a circular.

Currently, the country's SLB market is very shallow. In April, this segment's turnover was Rs 322 crore.

In November 2012, capital markets regulator Sebi had allowed rollover facility in SLB scheme.