Last Updated:July 04, 2025, 11:12 IST
The revised framework, effective June 30, 2025, replaces the earlier short-term fee cycle with an annual tiered charging model.
According to the circular, Messages Per Second (MPS) throttle limit charges will range from Rs 0 for 40 MPS to Rs 5,00,000 for 1,000 MPS, and Rs 5,00,000 per additional 1,000 MPS beyond that.
In a significant move, BSE has overhauled its Messages Per Second (MPS) throttle limit charges for the equity derivatives segment, as per a recent circular dated May 27, 2025. The revised framework, effective June 30, 2025, replaces the earlier short-term fee cycle with an annual tiered charging model. According to the circular, fees will range from Rs 0 for 40 MPS to Rs 5,00,000 for 1,000 MPS, and Rs 5,00,000 per additional 1,000 MPS beyond that. This marks a sharp shift from BSE‛s previous scheme (introduced in October 2024), which had provided a much higher free message rate threshold and charged in shorter intervals.
Under the earlier framework (September 30, 2024), trading members enjoyed free throttle capacity up to 10,000 MPS. Beyond that, additional throughput could be purchased in blocks of 1,000 MPS at a rate of Rs 10,000 for each additional 1,000 MPS (for 15-day periods). Charges were calculated twice monthly based on the peak usage in each half-month cycle. In contrast, the new framework slashes the free allowance to just 40 MPS and sets hefty annual fees for higher throughput, albeit billed on a monthly cycle going forward. The first billing under the new structure will cover June 30-July 31, 2025, and thereafter follow a monthly cycle, effectively annualising what used to be fortnightly fees.
The cost structure shift is striking. Under the old system, a mid-sized broker sending 5,000 messages per second paid nothing. Now, even 100 MPS will incur Rs 50,000 per year. High-frequency members who previously paid Rs 10,000 per 1,000 MPS (about Rs 20,000 per month for each block) will now face annual lump-sum fees — for example, 1,000 MPS now costs Rs 5 lakh/year (about Rs 41,667 per month). This could raise costs significantly for brokers previously relying on the 10k free MPS tier. However, BSE’s new per-unit pricing at higher tiers is lower than NSE‛s, indicating a pricing strategy aimed at gaining volume.
Comparing BSE and NSE: Divergent Throttle Models
NSE has long operated a connectivity-based model for throughput. Each connectivity link is rated for a message-per-second category — e.g. Category A: 40 MPS, B: 100 MPS, C: 200, D: 400, up to H: 10,000 MPS. Members can run up to 50 user IDs per segment on a single IP. In contrast, BSE allocates MPS at the user ID level, requiring firms to distribute their total quota across each dealer or algo session ID. Despite BSE‛s lower price tags at high volumes, NSE‛s model is operationally more efficient. Brokers manage MPS per IP instead of per session, allowing for streamlined control.
Flexibility: NSE’s Structured Plans vs BSE’s Rigid Cycles
NSE provides members with structured upgrade/downgrade pathways and a consistent MPS allocation. BSE lacks these features. The new charges are termed ‘annual’, but are billed monthly. However, there’s no explicit clarity on whether members can downgrade or reduce capacity mid-year. Members are also subject to exchange-level monitoring and potential optimisation of limits, which may not always align with business needs.
NSE’s flexibility allows members to plan bandwidth usage more efficiently. In contrast, BSE’s model forces big capacity jumps (e.g. 400 to 1,000 MPS) and rigid subscription blocks, adding cost and planning pressure.
‘Intraday Monitoring Spurs Uncertainty’
According to industry players, perhaps the most controversial provision in BSE’s new framework is the exchange’s right to revise MPS limits intraday if total usage exceeds predetermined thresholds. This means members could face throttling without warning.
“Such unpredictability is uncommon in exchange environments,” said an industry player, who did not want to be named.
The NSE does not employ intraday adjustments of this nature — once a member pays for a certain MPS, that bandwidth remains guaranteed unless voluntarily changed.
“This dynamic throttling introduces operational risk for algorithmic traders and institutions dependent on consistent throughput,” the industry player said.
Impact on Brokers, Vendors, and Clients
“Brokers face increased costs and administrative complexity. A broker that previously sent 15,000 MPS for free may now pay Rs 75 lakh annually for equivalent throughput. Smaller brokers also need to carefully allocate MPS across user IDs, risking operational errors if not managed properly,” an industry person said.
Vendors must adapt trading and back-office systems to handle new monitoring, MPS reassignment, and rejection protocols. This creates added development, testing, and compliance workload, he added.
“Clients may be indirectly impacted via higher brokerage rates or degraded order execution if brokers restrict BSE access to save on costs. There’s also concern over whether these changes will reduce liquidity and activity on BSE’s derivatives platform, especially among algorithmic traders,” he said.
Outlook: Efficiency Vs Cost – A Delicate Balance
BSE’s overhaul of its throttle framework reflects a desire to monetise infrastructure and improve efficiency. “However, the sharp reduction in free MPS, lack of downgrade flexibility, and unpredictable intraday adjustments may deter active participation — especially from brokers who value certainty and control,” the person said.
The shift will likely benefit BSE’s bottom line but could come at the cost of market share if participants migrate to NSE where the infrastructure model, though more expensive, is better understood and more stable. Whether BSE‛s lower pricing at high tiers offsets these structural drawbacks remains to be seen.
Giving a few suggestions, Vijay Sardana, risk management advisor and advocate of the Supreme Court of India, said, “Create a comparative table between different slabs and comparision between exchanges. This will be more transparency and informed decision can be taken by brokers and traders. The terms and conditions should also mention upgrade and downgrade of slab is possible or not and what will be the lag time for it’s implementation. What will happen if a broker crossed the upper limit on a given day due to some emergency, while doing trading, will he be allowed to continue in higher slab or trading will stop. What will happen in case of such unexpected situations? What will be the time slab for these changes.
These should be clarified by both the exchanges.”
What Is MPS & Throttle Limit?
MPS (Messages Per Second) is a measure of trading system speed/capacity — how many messages (like orders, cancellations, modifications) a member can send per second.
A Throttle is a limit or cap imposed on MPS to ensure fair usage of exchange resources, avoid system overloads or abuse, charge users proportionately based on system load.
Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to markets, economy and companies. Having a decade of experience in financial journalism, Haris has been previously asso…Read More
Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to markets, economy and companies. Having a decade of experience in financial journalism, Haris has been previously asso… Read More
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