What Sebi’s 15% 'hard ceiling' on open interest means for broker growth, customers: Zerodha’s Nithin Kamath explains

Zerodha founder and CEO Nithin Kamath said the 15% open interest (OI) cap at the broker level places a hard ceiling on how much a broking firm can grow and the pace of that growth. While the restriction limits scale, it ultimately benefits consumers by reducing concentration risk and preventing any single broker from becoming too dominant.Kamath also called broking a unique business while giving an insight into what goes inside it."Broking is a unique business because there's a hard ceiling on how much we can grow and the rate at which we can grow. What most people don't realise is that SEBI has set a 15% open interest (OI) cap at the broker level," Kamath posted on his official X handle on Tuesday."No single broker can hold more than 15% of the total market OI. This restriction exists to mitigate the risk of concentration from any single broker becoming too large. Concentration is beneficial for business but ultimately detrimental to consumers," the tweet said.Drawing a parallel with UPI applications, Kamath said that the National Payments Corporation of India (NPCI) has created a similar restriction on third-party UPI applications though the measure was never implemented."This is similar to the 33% market share restriction that NPCI imposed on third-party UPI apps. That measure was never implemented because it would've meant UPI apps stopping transactions, but in our case, the limit is applicable," Kamath said.Also read: Zerodha’s late MTF entry still nets 5% market share but Nithin Kamath flags cost blind spotHow Zerodha has benefitted?Kamath said that the only way individual brokers can grow is if other brokers also grow, and fortunately for Zerodha, the overall market has grown helping the firm to maintain its 15% OI market share for the last five years."For us to grow, the overall market must grow, and that means other brokers must also do well. Although we have been at nearly 15% of OI for the last five years, fortunately, the overall market has grown, and we've benefited," Kamath said. <blockquote class="twitter-tweet"><p lang="en" dir="ltr">Broking is a unique business because there&#39;s a hard ceiling on how much we can grow and the rate at which we can grow. What most people don&#39;t realise is that SEBI has set a 15% open interest (OI) cap at the broker level.<br/><br/>No single broker can hold more than 15% of the total…</p>&mdash; Nithin Kamath (@Nithin0dha) <a href="https://twitter.com/Nithin0dha/status/2008502215284240426?ref_src=twsrc%5Etfw">January 6, 2026</a></blockquote> <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>(Disclaimer: The recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)