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NISM Certifications · NISM-Series-VII: Securities Operations and Risk Management · Other Services Provided by Brokers

A broker's client wants to receive trade confirmations and contract notes electronically. Which statement about electronic contract notes (ECN) is correct?

An electronic contract note may be issued only to a client who has provided a valid email ID and opted for electronic delivery, and it must carry the broker's digital signature. Brokers cannot choose any email address or skip the digital signature requirement.

  1. AECN may be sent only if the client has provided a valid email ID and has agreed to receive it electronically, and it must be digitally signedCorrect
  2. BECN can be sent to any email ID the broker chooses without client consent
  3. CECN need not be digitally signed
  4. DECN is permitted only for institutional clients

Explanation

Brokers may issue contract notes in electronic form to clients who have provided an email ID in the KYC and consented. The ECN must be digitally signed and sent within the prescribed time. Sending to any ID without consent, skipping the digital signature, or restricting it to institutions is not what the rules say.

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