There is a need to check this spreading menace of renting of NCFM certificates. The most unfortunate part of this renting activity is the reflection of corruption which has spread its tentacles all across the country

NSE Certification in Financial Markets (NCFM) is an online testing and certification program in financial markets. NCFM offers various educational programs in various areas of finance including capital markets, banking, portfolio management, currency, etc. But the criticality of these statements lies in the fact that some of the certifications started by the National Stock Exchange (NSE) have regulatory significance also. 

As per NSE guidelines for membership which is available on its website, it is distinctly mentioned that “At any point of time the applicant has to ensure that either the proprietor/one designated director/partner or the Compliance Officer of the applicant entity should be successfully certified either in the Securities Market (Basic) Module or the Compliance Officers (Brokers) Module or the relevant module pertaining to the segments wherein membership of the Exchange has been sought.i.e.

• • Capital Market (Dealers) Module
• • Derivatives Market (Dealers) Module
• • National Institute of Securities Markets (NISM) Series I – Currency
• • Derivatives Certification Examination”

The guidelines obviously state the significance of these four certificates. For me the significance of these certificates lies in the fact that I have myself passed more than 10 modules of NSE certifications at different stages and helped many people pass this test. However, what pains me is the fact that these certificates which are supposed to be the benchmark for membership are openly available for renting in the market. There are various advertisements put on websites such as www.quickr.com ,www.olx.com, etc. People publishing these advertisements have the courage to publish the advertisements without any fear. One advertisement from Madurai states that it has wide network of 300 plus sub-brokers and also provides best rate for both buyers and sellers. Many other people are fearless, as well. They share their contact details without any fear. In some of the advertisements, rates are also mentioned which ranges from Rs1,500 a month to Rs3,000 a month.

There are some groups also created on Facebook’ which facilitate transactions in NCFM certification. Those people who have qualified NCFM certificates openly offer their certificates for rent. This process of renting NCFM certification goes beyond individuals and it is obvious that some middlemen are also involved in this process.
 

But the most important question is how these certificates are getting used if they are being rented. Does this mean that the people using NSE terminals at various locations are not themselves certified and hence need to use these borrowed certificates? If this happens to be case, then isn’t it a clear-cut violation of NSE guidelines? Though modus operandi of using these certificates which are obtained through online renting is not well known, this is how it supposedly works. If a person wants to start a broking firm and does not have a certificate, he borrows it from some person who already has these certificates and shows him as part of the broking organization in some way or other.

It is indeed surprising and shocking that such incidents are happening across country. There is a need to check this spreading menace of renting of certificates. The most unfortunate part of this renting activity is the reflection of corruption which has spread its tentacles all across the country.

(Vivek Sharma has worked for 17 years in the stock market, debt market and banking. He is a post graduate in Economics and MBA in Finance. He writes on personal finance and economics and is invited as an expert on personal finance shows.)