This stock broker comparison is between two of the biggest discount brokers in India. This article will compare 5paisa and Zerodha based on their brokerage charges, account opening charges, maintenance charges, exposure margin, trading platform and more. This comparison will help highlight the major difference between these two brokers to help you find the best on your preference.
A brief history on Zerodha
Zerodha is the biggest private discount broker in India and was founded in the year 2010 by Nitin Kamath. It is known to be one of the best for traders and investors looking for low brokerage, reliable trading platform and easy interface. It has over 2.2 million clients that contribute over 15% of daily retail trading volumes across NSE, BSE and MCX. Zerodha is the largest stockbroker in India and is headquartered in Bangalore. It offers zero brokerage on delivery trading and a flat rate of 0.03% or Rs 20 per executed on other segments.
Zerodha offers a zero brokerage charges for delivery equity investment and direct mutual fund investments. For the other services like F&O, currency and commodity trades across NSE, BSE, and MCX it offers a flat brokerage of flat Rs 20 irrespective of the trading volume. The number of active clients on NSE is 9,09,008 as of November 2019. The other services it offers it offers Direct Mutual fund investments, Kite APIs.
A brief history on 5paisa
5paisa is a public discount broker that provides you the platform to trade in stocks, futures and other option at the lowest cost of Rs 20 flat per trade, even if you trade 10 crore. It is headquartered in Mumbai and is a part of India Infoline (IIFL). It is leading non-banking financial institution in India with two decade long experience as it was initially incorporated in 1995. 5paisa was relaunched in 2016.
It was reintroduced new brokerage model for online retail broking services and also got demerged itself from IIFL so that it can get listed on the stock exchange. 5paisa capital started trading on NSE/BSE in November 2017 making it the first to be listed in the financial digital marketplace. 5paisa capital provides a platform for all financial products which include equities, derivatives, mutual funds, commodities, bond and debentures, insurance and personal loans.
The account opening process for 5paisa is totally paperless based on Aadhaar. 5paisa provides the trading facility in mobile, browser and desktop platforms. The number of active clients on NSE is 1,06,280 as of November 2019. The other services it offers are Mutual Fund Investments, Research reports, etc.
The side by side comparison of 5paisa and Zerodha
5paisa vs Zerodha Charges and AMC
5paisa trading account charges is Rs 650 while Zerodha takes Rs 200 as account opening charges. 5paisa Demat Account AMC (annual management charges) charges is Rs 540 which is charged at Rs 45 per traded month and Zerodha Demat account AMC charges is Rs 300.
|Types of AMC||5paisa||Zerodha|
|Trading Account Opening Charges||₹650||₹200|
|Trading Account AMC Charges||free||free|
|Demat Account Opening Charges||free||free|
|Demat Account AMC Charges||₹540 (₹45 per trade)||₹300|
About brokerage plans and brokerage charges
Both the platforms do not provide multiple, monthly or yearly plans and only offer single broker plans. But when it comes to brokerage plan details 5paisa is a discount broker which charges a flat fee of Rs 20 per executed order for equity cash and equity F&O, including currency and commodity. This is the lowest brokerage plan offered by the offered by the best brokerage house in India. Zerodha on the other hand, charges Rs 20 or .03% whichever is lower for equity intraday, F&O, currency and commodity. No other upfront brokerage or turnover commitments on your trade.
|Plan Name||Flat Fee Rs 20 Trading Plan||Max Rs 20 per order Trading Plan|
|Equity Intraday, Futures, Options||Flat Fee Rs 20||0.03% or Rs 20 whichever is lower|
|Currency Futures, Commodity Trading||Flat Fee Rs 20||Flat Fee Rs 20|
|Call & Trade Charges||Rs 100 per call(No limit of orders)||Rs 50 Per Executable Order|
Demat account opening charges
This table shows the difference demat services that both the broker services provide and its charges.
|Demat Account Opening Fee||Nil||₹50 (Stamp charges payable upfront)|
|Demat Account AMC||₹540 (Charge ₹45 per traded month)||Individuals/Non Individual - ₹300 + GST Non Individual - Corporate - ₹1000|
|Dematerialisation Charges||₹15 per certificate + ₹40 as postal charges||₹150 per certificate (+ ₹100 Courier charges)|
|Rematerialisation Charges||₹15 per certificate or ₹15 for every 100 securities or part thereof whichever is higher + ₹40 for courier||₹150 per certificate + CDSL charges + ₹100 Courier charges|
|Transaction Charges (Debit or Sell)||₹12.50 per transaction per script||• Market Trades: ₹8 + ₹5.5 •Off-Market Trades: 0.03% of ₹25 whichever is higher|
The main Orders that all the broker platforms offer are CNC order (cash and carry), MIS order (margin intraday squareup), NRML order (normal margin). There four types of orders Cover orders provides additional margin and are placed for an compulsory stop loss and this is a intraday position. The second one is the Bracket order where you lock in a profit by bracketing an order with two opposite side orders. This will help you get a higher margin and limit your loss.
The third order is the after market order that are sent to exchange on the next day. The last one is GTC which are Good Till Cancelled order, which means you can buy or sell equity limit orders and your orders will remain in the system until its executed.
|CNC, MIS and NRML orders||yes||yes|
|Cover order and Bracket order||yes||yes|
|AMO-After Market Orders||yes||yes|
|GTC-Good Till Cancelled||yes||yes|
Investment offers contain Equity Derivatives (on both exchanges NSE/BSE), Commodity Trading (both brokers offers this on MCX), Online Mutual Fund Investment (offered on online mutual fund investment option) and Portfolio Management Services (both the brokers don't offer this).
|Equity Cash and F&O||yes||yes|
|Currency Deravitives and Commodity||yes||yes|
|Mutual Funds and ETF||yes||yes|
|Bond / NCD||yes||yes|
The PROS and CONS of Zerodha
- Free equity delivery traders. No brokerage charges for Cash-N-Carry orders.
- Zero brokerage charges for delivery trading across segments and exchanges with a maximum brokerage of Rs 20.
- Excellent trading platforms (KITE) available for free.
- Easy and fast online account opening with simple and flat brokerage model in all other segments and exchanges BSE, NSE and MCX.
- Over 10 lakh active customers and 10% of daily volume at BSE, NSE and MCX.
- Zerodha Referral program offers 10% brokerage share to clients you refer.
- Good Till Triggered (GTT) order are available which are similar to orders.
- Doesn’t provide stock tips, research reports or recommendations.
- Call and trade is charged at extra Rs50 order and auto square off is charged at extra Rs 50 order.
- Doesn’t offer 3 in 1 account.
- Doesn’t offer unlimited trading plans and AMC free demat account.
The PROS and CONS of 5paisa
- Flat fee brokerage. Pay just Rs 20 per executed order with no worries about the size of the trade.
- Free trading software including 5paisa mobile app and trading terminal.
- Up to 20 times exposure in intraday trading and 4 times more exposure.
- 3.5 times more exposure in derivatives Intraday Trading.
- It is the cheapest broker, flexible brokerage plans and research reports available but at an extra cost.
- Call and trade is charged at Rs 100 per call in addition to the brokerage. Any number of trades can be placed in one call.
- Research and advisory is available at extra cost.
- Higher exchange turnover charges in comparison to other popular discount stock brokers.
- Higher demat debit charges Rs 25 per transaction.
- NRI trading and Demat account is not available.
- Doesn’t offer commodity trading.
The premium services offered by zerodha and 5paisa
Zerodha, being the biggest discount broker in India has over 22 lakh clients which is because of trust and brand value. Moreover, initiatives like educational facility (Varsity), investment in IPO’s from the same dashboard, free direct mutual fund investments, etc create more value for its clients. Zerodha has got a bigger range of partner products that help traders and Investors like Streak, Sensibull, Learn app, etc.
Whereas on the other hand, a few known advantages of 5Paisa over Zerodha is that they offer Research reports and robo-advisory to their clients, which Zerodha doesn’t have. However, this facility by 5Paisa is offered only to its clients with higher plans. In addition to that, the multiple flexible brokerage plans offered by 5Paisa can also be a little advantageous for volume traders.