Abstract The discount brokerage platform based on financial technology (Fintech) has brought major changes in the intermediary system of Indian capital markets. This paper analyzes this change through a qualitative case study. It focuses on four large discount brokers: Zerodha, Grove, Upstox and Angel One, and examines their impact on traditional full-service brokers. This discount broker has seen tremendous growth in the recent years, especially after the COVID pandemic. As of mid-2024 the discount broker has emerged as the dominant segment in the field of Indian stock market broking industry. the key elements of the discount broking are cost efficiency, platforms based on the technology, sharp rise in the level of retail participants, support from the regulatory authorities e.g. SEBI. This shift from traditional broker to new age discount broker reflects a structural transformation in the Indian stock market. This study uses disruptive innovation theory; Porter's Five Forces model and technology acceptance model. It examines changes in business models, regulatory issues under SEBI (Special Economic Interests Bureau) and changes in retail investor behavior. The results clearly reveal segmentation in the brokerage market. There has been a significant decline in intermediary revenue. Retail investor involvement has amplified rapidly. There are significant shortcomings in the regulation of algorithm-based retail trading. The paper accomplishes with policy recommendations for SEBI and strategic action for traditional intermediaries to adapt to the new market conditions.
Bhushan Revasing Rathod (Thu,) studied this question.