ISLAMABAD -  The SECP has approved the regulations of the National Clearing Company of Pakistan Limited (NCCPL) to provide for the clearing and settlement mechanism of the Direct Settlement Services (DSS), which is operated and managed by the Central Depository Company of Pakistan Limited (CDC).

Currently, the investors of stock market can only settle their trades through the sub-accounts, which are under the control of the brokers. It is important to highlight that the investors also have the option to open the Investor Account which is operated by CDC itself only upon the instructions of the client and eliminates the risk of misuse of securities by the broker. However, as per the prevailing settlement mechanism, the investors were not able to settle their trades through their Investor Accounts. The introduction of DSS removes this weakness and enables the investors to settle their trades form their respective Investor Accounts without the involvement of brokers.

The DSS is expected to be made operational by the CDC from June 2, 2014 as per the instructions of the SECP.

The approval of DSS regulations is another landmark achievement of the SECP in its strive to protect investors’ interest and prevent misuse of assets of clients by the brokers. The introduction of DSS is also another step towards empowering the investors and strengthening capital market infrastructure through innovative products.