Authorized Person or Sub Broker Franchise- A Review
The popularity of stock market investment is steadily growing in India. If you wish to start your business with stock broker, there are two different ways to start. You can either choose to start a Authorized Person or Sub Broker Franchise to increase your earning.
On contrary, a sub broker and an authorised person are not same. They are slightly different in terms of eligibility criteria, duties and responsibilities, and the amount of investment needed to start.
Who is an authorized person?
In India, traders cannot trade directly in stock market, they need to do it through an authorised person, who are experts in financial market engaged by the broking houses. So, when you want to do trading, you are probably doing it through authorized persons.
Authorized persons are known as acting agents of broking houses. They are not directly registered with the stock exchange but as an appointed authorities under the stock broker. Earlier, authorized persons were required to enrol under SEBI, but as per new rules, it is no longer needed.
How to become an authorized person?
All you need to do is to register with a broking house. If you are 10+2, of education, then you can start right away as an authorized person. Authorized persons have to pay a commission for successful trading. You can also earn side income as an authorized person.
Difference between franchise and sub broker
Franchise between the stockbroker and the one who wants to buy the right to sell the goods and services of the stockbroker, they work under the stockbroker and have low risk involved. Sub-broker is one who gets the license from the stockbroker to carry the broking business under the name of the broker, they work with their individual name and High risk involved.
What is a Franchise?
A large broking house will allow authorized persons to operate under its brand name and license on fixed commercial term, known as franchise model. Individuals and small and medium business owners can also apply for a stock broker franchise.
Benefits of Sub Broker Franchise or Authorized Person
Here are some of the benefits of becoming a Sub Broker-
• High Revenue Share generated
• Low Investment Business
• Marketing and Training Support
• Best Advisory support
• New product, services & offers launched by the franchiser
• Good networking and preparing the clients for business
• Ask for Referrals
• Maintain Good Relationship with clients
• Keep yourself updated in the market