Things you need to know for becoming a sub-broker


The stock market in India is expected to create a lot of wealth for investors in the coming years as the Indian economy is expected to boom. The number of new investors opening demat accounts in the stock market are increasing. At the same time, so many companies have launched or are in the process of doing so lately. Some of the recently launched and upcoming IPOs include LIC, Campus Footwear, BoAt, and the OYO IPO. In August 2022, the number of demat accounts in India crossed 10 crore, and with time it is only to increase. 

And with growth in the retail investor segment, the stockbrokers catering to this segment are also going to scale up their operation. And that, in turn, will help in taking the sub-broking model to the next level. So if you wish to become a sub broker in India, you will need to know the following things. 

What is the Role of a Sub-Broker? 

First and foremost, if you are exploring a career in the sub-broking space, you must know who a sub-broker is, and what their role is. Simply put, a sub-broker is the agent of a brokerage firm or a stockbroker. They are the intermediaries that connect the intermediary (the broker) to the client (the investor). As the broker’s client base grows, it becomes challenging for the broker to allot resources to cater every client. 

That challenge has given rise to the sub-broking model, in which the sub-broker shoulders key responsibilities. Sub-brokers keep investors informed and help them make decisions regarding investments. The sub-broker also helps expand the broker’s client base, and for their services they earn a specific cut from the transactions made by clients. Now let us see what are the things you should know to become a sub-broker. 

  1. How to Find the Right Broker 

To become a sub-broker in India, you must tie-up with the right broker with the best sub-broking franchise model. The solid sub-broking franchise model will provide sub-brokers with plenty of opportunities and reward them with incentives. Another thing to look out for is the reputation of the stockbroker, as you would wish to partner with a reputable firm. Lastly, you partner with a stockbroking firm that can provide you with a robust technological backing. 

  1. The Eligibility Criteria 

After you pick a stockbroker to partner with, you then take a look at the eligibility criteria to become part of their sub-broker franchise. You can find the eligibility criteria on the websites of the broker. The good thing is, the eligibility criteria to become a sub-broker are quite basic and easy to meet. Generally, brokers only ask for a minimum education qualification of 10+2, i.e., 10th grade + 2 years of high studies (HSC). Apart from education qualifications, you must also have a knowledge of the securities market.  Lastly, strong communication skills are also a must to form healthy relationships with clients. 

  1. The Form Filling Process 

After you picked your broker and checked the qualification criteria, you proceed to filling the sub-broker application form and submitting the required documents. You may be asked to submit the following documents for: 

  1. Identity proof (PAN Card or Aadhaar Card)
  2. Address proof (valid ration card, driver’s licence, passport, or latest electricity bill) 
  3. Experience document if your qualification is lower than HSC

You submit the above documents and pay the required processing fee. 

  1. Application Verification Process 

After submitting your application form for becoming a sub-broker, the stockbroker will send your application to the stock exchanges. The exchange then verifies your details, and sends it back if they find any discrepancies. In that scenario, you are to make the required corrections and re-submit the corrected documents. However, if your application is free of any errors, the exchange approves of it. 

  1. The SEBI Registration Procedure 

The final step to becoming a sub-broker requires you to register yourself with the Securities and Exchange Board of India (SEBI). Just like the stockbroker, the sub broker, too, requires SEBI’s permission to start providing services. You pay SEBI’s registration fee to obtain a licence, and then you will receive a registration certificate and number and become a sub-broker. 


So, if you wish to become a sub-broker in India, these were the main points you needed to know. Once you become an official SEBI registered sub broker you can start providing services and help clients decide whether or not they should be investing in the upcoming IPOs like the BoAT and OYO IPO.