2026 has been a busy year for Nepal's capital market regulator. The Securities Board of Nepal (SEBON) has rolled out a major new margin trading framework, the government has reformed capital gains tax, and several bigger structural changes — short selling, derivatives, NRN market access — are in the pipeline. Here's what's actually changed and what's still on the way.
1. Margin Trading Directive, 2082 (Live Since February 2026)
The biggest structural change this year: SEBON approved the Margin Trading Facility Directive, 2082, replacing the largely dormant 2017 framework. It came into effect on Falgun 1 (February 13, 2026), formally allowing brokers — rather than just banks — to extend credit to investors for buying shares.
- Initial margin requirement: Investors must deposit at least 30% of the purchase value themselves, with the broker financing the rest.
- Maintenance margin: Investors must maintain a minimum margin (commonly cited around 20% of the purchased share value) throughout the loan period. If the portfolio value falls below this, a margin call is triggered, requiring additional funds or securities within a short window — typically by 11 AM the next day.
- Broker eligibility: Only brokers with a minimum paid-up capital of NPR 20 crore (200 million) and proper clearing/depository approvals can offer margin services. Initially, roughly 60 of Nepal's 90 licensed brokers met this threshold.
- Stock eligibility: Only companies meeting specific criteria — a minimum number of publicly listed shares, net worth at or above paid-up capital, and consistent profitability — qualify for margin lending.
- Client lending caps: Brokers are restricted from over-concentrating margin credit with any single client or their immediate family — reported figures on the exact cap vary between sources (commonly cited as either 10% or 20% of the broker's relevant net worth/lending capacity), so confirm the precise current figure directly with your broker or SEBON's published directive rather than relying on a single number here. The underlying intent, regardless of the exact percentage, is to prevent one client from concentrating too much risk with a single firm.
- Transparency measure: Investors must use separate "Margin Trading Demat Accounts," and NEPSE now publishes daily disclosure of aggregate margin usage in the market.
For retail investors, this means more buying power — but also real risk. Margin trading amplifies both gains and losses, and a sharp market dip could trigger a forced sale of your shares if you can't meet a margin call in time.
2. Capital Gains Tax Reform (Effective Mid-July 2026)
As part of the FY 2026/27 budget, capital gains tax on listed shares is becoming a final withholding tax — removing the need to report share profits separately in personal income tax filings — while simultaneously raising the rates to 7.5% (long-term) and 10% (short-term). We've covered this in full detail here: Nepal Capital Gains Tax on Shares 2026.
3. Reforms Still in the Pipeline
Alongside the tax changes, the FY 2026/27 budget outlined several structural reforms that are expected to roll out gradually rather than immediately:
- Short selling: Government has pledged to introduce short selling as a new trading instrument on NEPSE, though a specific rollout date hasn't been confirmed.
- Derivatives trading: Advanced instruments like derivatives are planned as part of NEPSE's broader modernization push.
- Intraday trading: Same-day buy-sell trading is under consideration, which would be a significant shift from the current settlement-based system.
- NRN (Non-Resident Nepali) market access: Legal amendments are pledged to allow NRNs to participate more directly in the secondary securities market, along with clearer rules on profit repatriation.
Since these are still in the planning or legislative stage, retail investors shouldn't expect immediate implementation — but it's worth watching for official SEBON and NEPSE circulars over the coming months.
What This Means for You as a Retail Investor
- Margin trading isn't mandatory — you can continue investing with cash only if you prefer to avoid leverage risk.
- If you do consider margin trading, understand the maintenance margin requirement fully before opening a margin account — forced liquidation during a market dip can lock in losses you might otherwise have avoided by waiting it out.
- Tax planning matters more now — with CGT becoming a final tax at higher rates, factor this into your expected returns on any sale.
- Stay updated — with multiple reforms in progress, checking SEBON and NEPSE's official announcements periodically is more important than ever this year.
Frequently Asked Questions (FAQ)
Do I have to use margin trading as a retail investor?
No, margin trading is optional. You can continue trading purely with your own cash without ever opening a margin account.
What happens if I can't meet a margin call?
If you fail to restore the required margin within the specified window, the broker is generally authorized to sell your margin-purchased shares to cover the shortfall.
Is short selling available in Nepal right now?
Not yet. It has been announced as part of planned reforms, but as of now, short selling is not an active feature on NEPSE.
Conclusion
2026 marks one of the more active regulatory years for Nepal's capital market — a live margin trading framework, a reformed capital gains tax structure, and several bigger changes still in progress. For retail investors, the key takeaway is simple: new tools like margin trading bring real opportunity, but also real risk, so understand the rules fully before opting in.
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