Nithin Kamath, CEO, Zerodha

Zerodha, the popular online brokerage firm may soon start charging millions of its users for equity delivery traders – a service that has long been free—if regulatory headwinds continue to impact its core business. In a lengthy blog post marking Zerodha’s 15 anniversary, CEO Nithin Kamath emphasised that the mounting risks facing the brokerage industry and the company’s need to pivot. Kamath revealed that the brokerage revenue of Zerodha has dropped by 40% in Q2 FY 2025 as compared to the same quarter last year. Kamath outlined that this decline comes from a series of regulatory changes which include:

Kamath emphasised that these changes have hit Zerodha’s primary revenue stream which is active options trading and is also forcing the company to reassess its business model.

‘The risk has crystallised’

Known for his cautious outlook on the industry, Kamath wrote, “Another year where I was pessimistic about the business has passed, and it’s been another year where I’ve been pleasantly surprised. 🙂 That said, the regulatory actions, be it the drop in transaction charges revenue, the increase in STT on F&O, the proposal to make futures and options trading tougher, ASBA for trading, the increase in BSDA limit, etc., will have a significant impact on our revenues and profitability. The time has finally come for business to pivot.”Rivals in the industry already charge for delivery trades, Zerodha has maintained a zero-brokerage policy for years, contributing to its massive user base. However, Kamath warned that this may no longer be sustainable.Despite the dip in the revenue, Kamath assured users of Zerodha’s financial health. The company has a net worth Rs 13,000 crore, zero debt, and handles over 50% of client funds with its own capital. He also stressed on the fact that Zerodha’s commitment to privacy, transparency, and ethical product design—avoiding dark patterns and intrusive data practices.