How to Become a Sub-Broker in India with ArihantPlus

India’s capital markets have significant room to grow. Investor participation remains relatively low compared with several developed markets. And the next wave of growth could come from well beyond major cities like Mumbai, Delhi or Bengaluru.  

According to a latest report by EY, India could add more than 10 crore long-term investors by 2035. The opportunity extends to emerging cities, young professionals, women investors and households that are yet to participate meaningfully in capital markets.

For aspiring entrepreneurs and financial professionals, becoming an Authorised Person (AP) with a stockbroker is one way to participate in this growth without setting up an independent brokerage firm.

But what does the business involve, how much does it cost, and how do you get started? Here’s what you need to know. 

Formerly known as sub-broker, an authorised person is an individual or an entity who works with an established stockbroker and helps the broker expand its reach, acquire clients and support their trading journey within the permitted scope of activities. The term Authorised Person (AP) was first introduced by the Securities and Exchange Board of India (SEBI) in 2009.

As an AP, you build client relationships, introduce clients to the broker’s services and support their trading journey within the permitted scope of your appointment. The stockbroker provides the trading infrastructure and other services covered under the partnership.

Think of it as running your own business with the support of an established brokerage.  

You don’t necessarily need a finance degree or prior experience in the stockbroking industry to explore this opportunity. However, you must meet the applicable eligibility requirements and complete the necessary registration formalities.

Individuals, partnership firms, LLPs and eligible corporate entities can apply, subject to the relevant exchange’s rules.

For an individual applicant, the general eligibility criteria include:

• Being an Indian citizen.
• Being at least 18 years old.
• Having passed Class 10 or an equivalent examination recognised by the government.
• Having a good reputation and character, with no disqualifying conviction involving fraud or dishonesty.
• Meeting the applicable certification requirements for the relevant exchange segment.

Additional requirements may apply depending on the applicant’s constitution, the exchange segment and ArihantPlus’s onboarding policies. For firms and companies, the eligibility of partners or directors, business-object clauses, and infrastructure requirements may also be relevant.

This opportunity may be worth exploring if you are:

• A financial professional: Looking to expand your existing financial services business.

• An entrepreneur: Interested in building a client-focused business in the capital markets.

• A financial educator or market enthusiast: Looking to turn your market knowledge and professional network into a business, while meeting all applicable requirements.

• An existing Authorised Person: Exploring a move to another brokerage, subject to the relevant exchange rules, existing contractual obligations and approval requirements. 

Choosing the right brokerage partner is an important business decision. The technology, research, commercial terms and support you receive can influence both your day-to-day operations and your clients’ experience.

ArihantPlus, backed by Arihant Capital Markets Limited, brings over 34 years of experience, a network of 700+ partners and a presence across 110+ locations.

Here's what you can expect:

• High Revenue Sharing: Get high revenue sharing and monthly payouts.

   

• Trading Platforms: Give clients access to ArihantPlus mobile and web trading platforms – super fast and smart trading platforms for traders and investors. Learn more here.

   

• Research: Access award-winning research and market insights. We are a Sebi-registered RA.

   

• Business Support: Get access to training, webinars, relationship manager assistance and marketing support.

• Build your own brokerage (BYOB): ArihantPlus offers unique BYOB plan, so you cant create a plan to cater to different client needs - discount, full-service brokerage or hybrid plans that suits your scale .

• Digital Onboarding: Fastest 3-min onboarding platform. 100% digital, with slick user-friendly UI on web and app.

The idea is straightforward: you focus on building relationships and growing your business, while ArihantPlus provides the brokerage infrastructure and support to conquer. 

1. Getting started involves a few key steps.Submit an enquiry: Visit the ArihantPlus Partner With Us page and share your contact details.
2. Discuss the business model: Understand the available plans, exchange segments, deposit requirements, fees and revenue-sharing terms.
3. Submit documents: Provide the required personal, business and financial documents.
4. Complete registration: Sign the necessary agreements, pay applicable charges and complete the exchange registration process.
5. Start operations: Begin authorised activities after receiving the required approvals.
6. The approval timeline depends on documentation, verification and exchange processing. Submitting an application does not guarantee approval. 

The documents required depend on the type of applicant and the exchange segments selected. The following is a general checklist; ArihantPlus will confirm the exact requirements for your application. 

Additional documents or declarations may be required depending on the applicant’s constitution, exchange requirements and selected segments.

Partnership deeds, LLP agreements and company constitutional documents may also need to contain the relevant provisions for carrying out the proposed activities. 

Before starting, it's important to understand the costs involved - upfront investment and recurring operating expenses.

Initial Deposit and Registration Charges 

The upfront deposit must be paid through cheque or online transfer. Registration charges depend on the exchanges and segments selected.

Annual Maintenance and Other Charges 

GST is applicable at 18% on the specified taxable charges.

Under Arihant Capital's supplied policy, annual AP registration renewal is required.

Is the deposit refundable?

Yes, subject to the agreement. On termination, the deposit is refunded after six months or settlement of all outstanding dues, whichever is later. Applicable exchange cancellation charges may also apply.

This is probably the question you're most interested in.

As an Authorised Person, you have have multiple revenue streams when you work with ArihantPlus

• Brokerage revenue (sharing is based on the agreed commercial arrangement).
• Commission from mutual funds, PMS and AIF
• Fee from bonds, NCDs
• Referral fee from merchant banking business
• Introduction of other sub-brokers (Referral fee)

ArihantPlus also runs various contests and rewards programs offering partners additional earning opportunities, subject to eligibility and applicable terms.

However, there is no guaranteed income. Building a sustainable business takes time, consistent client service and responsible business practices. Before joining, understand the payout structure and calculate your expected costs rather than relying on headline earning claims. 

Becoming an AP may suit you if you have a strong network, enjoy working with people and are prepared to build a business over time.

However, client acquisition is only one part of the job. You also need to provide consistent service, understand your responsibilities, follow applicable regulations and manage costs carefully.

Before committing, assess three things: the demand for your services, the commercial terms offered by the broker, and the time and investment required to build a sustainable client base. 

Visit the ArihantPlus Partner With Us page to register your interest and discuss eligibility, costs and partnership terms with the team. 

1. What is the minimum deposit to become a sub-broker with ArihantPlus?

The standard upfront deposit is ₹1,00,000, excluding registration and other applicable charges.

2. Can I become a sub-broker without opening my own brokerage firm?

Yes. The Authorised Person model allows eligible applicants to operate under a registered stockbroker, subject to exchange approval.

3. Are there annual charges for Authorised Persons?

Yes. Applicable annual maintenance, service, software and other charges depend on your registration and business requirements.

4. How can I apply to become an ArihantPlus partner?

Visit arihantplus.com/partner-with-us and submit the enquiry form.

Disclaimer: Authorised Person registration is subject to applicable exchange regulations, eligibility and approvals. Charges, incentives and commercial terms may change. Confirm the latest details with Arihant Capital before applying.