Zerodha leans on interest and MTF income as broking revenue falls 10.4% in FY26

Zerodha’s FY26 broking revenue fell to ₹2,738 crore from ₹3,066 crore, while profit remained broadly flat at ₹4,283 crore. Interest income, delayed-payment charges and margin-trading funding are becoming more important as derivatives rules pressure core brokerage earnings.

— Source publishedSun, 30 Aug, 2026, 11:00 IST·First seen Mon, 31 Aug, 2026, 00:13 IST·Source Inc42 · Buzz

What happened

Zerodha’s brokerage revenue is declining amid derivatives regulation and client losses, prompting diversification into interest income, margin trading and AMC

Key facts

  • FY26 broking revenue: ₹2,738 Cr, down 10.4% from ₹3,066 Cr in FY25
  • FY26 profit: ₹4,283 Cr, versus ₹4,231 Cr in FY25
  • FY26 overall revenue approximately ₹8,847 Cr
  • FY26 interest income: ₹2,269 Cr
  • FY26 delayed-payment charges and MTF income: ₹448 Cr, versus ₹22 Cr in FY25
  • Q1 FY27: nearly 40% of gross revenue came from non-core businesses
  • Zerodha active clients: 6.76 Mn; NSE share: 14.88%
  • Groww active clients: 13.12 Mn; NSE share: 28.88%
  • Zerodha MTF book: about ₹9,000 Cr; customer borrowing: about ₹6,000 Cr
  • MTF contributes roughly 10% of Zerodha revenue

Why this matters

Zerodha’s results make lending, margin funding and adjacent financial-services capabilities more strategically valuable targets or partnership areas for brokers seeking to offset slowing trading-fee revenue.

What to watch

  • SEBI changes to derivatives, margin, client-fund or MTF regulations.
  • Quarterly growth in MTF book, interest income and delayed-payment charges relative to broking revenue.
  • Retail cash-equity turnover and active-client trends after derivatives-rule implementation.
  • Any increase in MTF delinquencies, forced square-offs or credit-loss provisions.
  • Interest-rate changes affecting funding spreads and customer borrowing demand.
  • Competitive responses from discount brokers seeking to replace lost derivatives revenue.
  • Expand margin-trading funding availability and improve in-app nudges for eligible customers.
  • Increase emphasis on interest-bearing balances, collateral management and repayment discipline.
  • Push customer activity toward cash equities, ETFs, mutual funds and long-term investing products to reduce derivatives dependence.
  • Tighten credit underwriting, collateral haircuts and collection processes as MTF exposure rises.
  • Use low-cost operating structure to defend profit margins rather than aggressively cutting brokerage prices.

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