How To Set Up A Share Market Franchise

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  • 29 Apr 2023

To start a stock market franchise business, you must first partner with a registered brokerage firm. Such a tie-up will bring you access to the broker’s brand name, trading systems, and catalogue of products and services. Carrying out stock market transactions on your clients’ behalf would then become quicker and more seamless. The association with a reputed broker could also help you to win over new clients and expand your business over time.

A stock market franchise business assists its clients to invest and trade in financial securities. Say, a client places a stock market order with the franchise business. The franchisee will then place the order via their partner broker’s trading terminal. Finally, the broker will execute the order as per the client’s instructions.

Once the transaction is complete, the client will pay a brokerage commission for the service rendered. This commission will be shared by the share market franchise business (the franchisee) and the partner broker (the franchisor). The share of each partner is outlined in a revenue-sharing agreement, the terms of which are finalised while setting up the franchise business.

Both partners have distinct functions:

  • The franchisee acquires new customers, interacts with them on a one-to-one basis, and carries out stock market transactions on their behalf.

  • The franchisor shares its tools and resources with the franchisee, so that the latter can provide all-round service to their client.

Setting up a stock market franchise business is easy when you partner with Kotak Securities. Our team provides comprehensive support and handholding right from the start of your entrepreneurial journey.

As our franchise partner, you get to build your client list as you deem fit. We support you by providing regular training in customer acquisition and onboarding. Our team provides essential resources to help your clients fine-tune their approach to investment and trading. That’s not all. We also have technology-backed trading platforms to simplify how orders are placed. Once your clients confirm their buy and sell requests, we step right in and execute the order as per the specifications. The whole experience is smooth and hassle-free.

At Kotak Securities, we have decades of experience in the stock broking franchise sector. So, we are well-equipped to guide you through every aspect of the franchise business.

If you wish to set up a share broking franchise, check if you meet the eligibility criteria:

Educational qualifications

Anyone who has passed their higher secondary board exam can open a franchise business. But you will have to complete the certification exam from the National Institute of Securities Markets (NISM). The NISM study modules cover the equity and derivatives markets, as well as mutual funds. The NISM certification is mandated by the Securities and Exchange Board of India (SEBI).

Work experience and technical knowledge

Having prior work experience with a brokerage house is a plus. Such experience implies that you have the technical knowledge to run a share broking franchise business. It also helps if you understand how the stock markets function and are updated on all market-related news.


Before applying to set up a share market franchise, you must register with SEBI and a local stock exchange. If you meet the above criteria, it’s time to take the next step: Find the right broker to partner with and submit your application. Just keep in mind that you will need to pay an initial deposit to the broker once your application is approved. The deposit amount varies from broker to broker and is usually negotiable.

Here’s how you could gain by taking the franchise route:

1. Ease of setting up business

The initial investment is small, and the fees for registering with SEBI and the local stock exchange are affordable. The regulatory requirements are low as well. Besides, anyone who has passed their higher secondary exams can apply, provided they have NISM certification.

2. Support from partner broker

Tying up with the right broker is critical. A partner like Kotak Securities will provide you with:

  • training to help you run your business and expand your client list;

  • technical assistance to make transactions more seamless;

  • advisory support such as market research and stock recommendations.

To open a stock market franchise business, you need a trustworthy partner that can help you grow your business. Kotak Securities could be the partner you need. Here’s what we have to offer:

1. Pan-India presence:

Our offices are spread over 450 locations across India, and we have been working in the franchise sector for more than two decades. Currently, we are partnered with more than 2,000 franchise businesses.

2. Reliable and steady: Kotak Securities is a full-service equity broking firm that is well-respected in the investor community. We have the financial backing of Kotak Mahindra Bank, one of India’s leading banking institutions.

3. Market leader We have been pioneers in the Indian financial environment. Kotak Securities was the first to introduce:

  • the flat brokerage fee model

  • margin trading for broking customers

  • systematic investment plans (SIPs) in direct equity through our product AUTOINVEST

  • investment in initial public offerings (IPOs) and mutual funds over the phone

4. Comprehensive product suite:

Partner with Kotak Securities to offer your clients a wide selection of asset classes. Choose from among equities, derivatives, mutual funds, structured products, initial public offerings (IPOs), and third-party products.

5. Robust technology:

We offer multiple tools and software to simplify your operations. Ease the way you do business through our dedicated terminals for online and offline customers and a smart back-office system. There’s also a mobile-based app for entrepreneurs who are constantly on the go.

6. Accredited research:

As a Kotak Securities franchise partner, you can freely access the in-depth research reports published by our team. You can also interact with our researchers via conference call and chat.

7. Regular training:

Navigating the financial markets is easier thanks to our comprehensive training programmes. Learn about the latest in trading tech, stay updated on market developments and regulatory changes, get tips on increasing sales, and much more.

8. Marketing support:

Our dedicated marketing team will provide the marketing support you need. We are here to help you put together everything from marketing brochures and outdoor signage to customer analysis and more. We even help you organise seminars and events to acquire and retain clients.

In A Nutshell:

If you want to be an entrepreneur, a stock broking franchise could be a great place to start. At Kotak Securities, we can provide the comprehensive support you need to set up a stock market franchise business. Join us to begin your entrepreneurial journey today!

Sub Broker With Kotak Securities:

Strong National Footprint

Strong PAN India presence in 450+ locations with over 2000+ relationships in Franchisee Business & our network is ever expanding. We have around two decades of experience in Retail, Sub Brokership and Franchisee Business. We have in-house premium research team covering more than 250 companies. Kotak Securities has been awarded as one of the Best for overall Country Research by Asiamoney Brokers Poll 2016 – Ranked first in overall Country Research.

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Seminars & Training Workshops

Given the current market scenario and pro-activeness of investors at every level, it is of paramount importance that you have an understanding of the current tools and are able to decipher the technologies and trends. To facilitate the same, we have devised training programs that keep you abreast of the current technologies with a view to understanding customer needs and fulfilling them. We organize training programs on an ongoing basis to keep you abreast of latest market developments, product innovations, etc. Also, we understand your need for engaging customers for ensuring business growth. Therefore, we have robust and out-of-box plans to engage your prospective and current customers through value-based and innovative investor meets.

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Sub-Broker FAQs

A sub-broker is an agent who is associated with a trading member of the stock exchange. To be a sub-broker, one must be registered with the Securities and Exchange Board of India (SEBI) and with a local stock exchange.

Sub-brokers help their clients to buy and sell securities in the stock market. They offer information to them on various securities. They also pass on the clients’ trading orders to the trading member or brokerage firm with which they are associated. For the service provided, they earn a percentage of the brokerage commission.

Follow these steps if you wish to become a sub-broker:

  1. Apply for certification from the National Institute of Securities Markets (NISM). The certification exam includes modules on equities, mutual funds, commodities, and derivatives.

  2. Register online with the Securities and Exchange Board of India (SEBI). Upload the relevant documents and pay the registration fee along with the initial deposit.

  3. Register with your local stock exchange.

  4. Apply to become a sub-broker at an established brokerage company like Kotak Securities. You will then gain access to research material, regular training, excellent tech tools, and constant support.

You are eligible to become a sub-broker if you meet the following requirements:

  • You have a secondary school graduation degree.

  • You are at least 21 years of age.

  • You have in-depth knowledge of financial services.

  • You already have a good network of clients.

  • You can make a minimum deposit of Rs 3 lakh (the amount is negotiable).

  • You have a 300-square-foot office, preferably in a prime location.

  • You have computers with ISDN or SAT connections.

You will have to pay a registration fee and make an initial deposit when registering with the Securities and Exchange Board of India (SEBI). You may also incur a fee when signing up with the local stock exchange.

Following this, when you apply to be a sub-broker of Kotak Securities, you will have to make a minimum deposit of Rs 3 lakh. The deposit amount is negotiable. In addition, you would need to have a 300-square-foot office space equipped with computers that have ISDN or SAT connections.

A sub-broker enlists clients and helps them with their securities trades on a one-to-one basis. The sub-broker may provide information to a client about different securities. They also convey the client’s buy and sell orders to the brokerage firm, which then executes the orders.

It should be noted that sub-brokers do not buy or sell securities directly. The brokerage carries out the actual trades. Sub-brokers simply carry out client-facing services on behalf of the brokerage company. In return, they earn a percentage of the brokerage commission.

You can become a sub-broker if you are at least 21 years old, hold a secondary school graduation certificate, and certification from the National Institute of Securities Markets (NISM). Before you apply to become a sub-broker, you would also need to register with the Securities and Exchange Board of India (SEBI) and your local stock exchange.

To become a sub-broker of Kotak Securities, you would need to make a minimum deposit of Rs 3 lakh (negotiable) and have a 300-square-foot office. The office should preferably be in a prime location and have computers with ISDN and SAT connections.

Yes, you can. Start by opening a trading account for yourself. Then manage your account like you would any other account on your client list.

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