Description

NSE Clearing revises position limits for MCX in Securities Lending and Borrowing Scheme, increasing limits approximately 5x across all categories effective January 5, 2026.

Summary

NSE Clearing Limited has revised the Market Wide Position Limit (MWPL) and position limits for Participants, Institutional clients, and Non-Institutional clients for MCX symbol in the Securities Lending and Borrowing Scheme. The revised limits represent an approximately 5-fold increase across all categories and will be effective from January 5, 2026. This circular modifies previous circulars NCL/CMPT/67763 (April 30, 2025) and NCL/CMPT/72105 (December 31, 2025).

Key Points

  • Market Wide Position Limit (MWPL) for MCX increased from 5,090,281 shares to 25,451,409 shares
  • Institutional client limit increased from 509,028 shares to 2,545,140 shares
  • Participant limit increased from 509,028 shares to 2,545,140 shares
  • Non-Institutional client limit increased from 50,902 shares to 254,514 shares
  • All limits increased by a factor of approximately 5x
  • Changes apply specifically to Securities Lending and Borrowing Scheme (SLBS)

Regulatory Changes

This circular represents a partial modification of circular NCL/CMPT/72105 dated December 31, 2025, and continues the framework established in circular NCL/CMPT/67763 dated April 30, 2025. The position limits for MCX in the Securities Lending and Borrowing Scheme have been substantially increased to accommodate higher trading volumes and participation.

Compliance Requirements

  • All Participants and Custodians must take note of the revised position limits
  • Revised limits must be implemented effective January 5, 2026
  • Participants should ensure their systems and controls are updated to reflect the new limits
  • Position monitoring should be adjusted to the new thresholds for MCX symbol

Important Dates

  • Circular Date: January 2, 2026
  • Effective Date: January 5, 2026
  • Applicable Period: January 2026 and onwards

Impact Assessment

The five-fold increase in position limits across all categories indicates enhanced liquidity and capacity in the Securities Lending and Borrowing market for MCX. This expansion allows:

  • Institutional participants: Greater ability to execute larger lending/borrowing transactions (up to 2.5 million shares vs. 509K previously)
  • Market capacity: Significant increase in overall market-wide capacity from ~5 million to ~25 million shares
  • Non-institutional clients: Increased access with limits raised to 254,514 shares from 50,902 shares
  • Market depth: Enhanced market depth and potential for improved price discovery in MCX securities lending operations

The timing for January 2026 suggests this may be in response to increased demand or anticipated growth in SLBS activity for MCX securities.

Impact Justification

Significant increase in position limits (5x) for MCX in SLBS affects participant capacity but applies to a specific lending/borrowing scheme rather than general trading