Yatish is a millennial and shows his special interest in stock market investment. But what’s the major challenge most of the newbies like him generally face before beginning a trade, is choosing the right stockbroker. To ease the choice he picks the two renowned stockbrokers and did a complete review of 5paisa vs Motilal Oswal.

When beginning the comparison, one of the major differences between the two is the type. On one hand, Motilal Oswal is the full-service stockbroker while 5paisa is a discount broker.

But to compare the services, he further listed some of the basic parameters that one must look for like:

And now, let’s dive in!!

Difference Between 5paisa and Motilal Oswal 

As mentioned earlier, 5paisa is a discount broker, and Motilal Oswal is a full-service broker, but what are other differentiating factors that define the reliability of the broker to Yatish? For that, let’s check the background of the stockbrokers.

While doing the research of the brokers, Yatish finds out that, in 1987, MOSL gets incorporated, whereas 5paisa came to the game in 2016. Here, he simply concluded that Motilal Oswal is an older broker as compared to the 5paisa and thus somewhere more reliable than 5paisa. 

But 5paisa is emerged from one of the reliable stockbroker IIFL and hence has strong support at its back.

To make the wise decision he dived into the details of trading styles offered by both the stockbrokers.

5paisa started the firm by providing the services of online share trading, insurance, mutual funds and afterward, introduced the segments to the customers for trading. 

Whereas, starting with the services of trading into equity, commodity, currency, derivatives, and mutual funds, Motilal Oswal still allows the customers to enjoy trading with the efficient trading platform created separately for investors (MO investor) and traders (MO trader). 

Apart from the services and year of establishment, have you ever wondered that how these stockbrokers are as a company?

To give a clear view, here is the data of the profit & loss and revenue generated by the company in the last financial year (2020-21).

 

As per the data, Motilal Oswal generated the revenue of ₹2365.41 crores which is around 1000 times more than the value generated by 5paisa which was around ₹193.86 crores.

Comparing the profit and loss, again Motilal Oswal recorded the profit of ₹215.4 crores while the profit earned by 5paisa is ₹17.32 crores. 

Although this data is not sufficient to analyze the companies fundamentally, as far as data is concerned, Motilal Oswal shows better growth in the last year, and the same expected growth could be expected in the years ahead.

Now let’s talk more about the broker and the registered services it offers to its customers.

So here you can trade in equity, commodity, currency with both the brokers. With so many investment options, currently, Motilal Oswal has reached a client base of 4,29,771.

On the other hand, the client base of 5paisa is 1,06,280 which is comparatively better as 5paisa is established almost 20 years after Motilal Oswal and is still able to grow more in terms of customers.

Other than this, taking the active client base into consideration, he gets to know that 5paisa is having active clients of 1,06,280, whereas, in the case of Motilal Oswal, it is 4,29,771. 

Now, this could be because of more years of services and experience of Motilal Oswal in the industry in comparison to 5paisa. 

The same resemblance can be seen in the number of branches as Motilal Oswal has its presence in 550 cities whereas 5paisa is only available in 25 cities which is a quite lesser number than MOSL.

This is because being a discount broker, 5paisa only offers online services with very few offline presences.

So, if you are looking for a stockbroker that is easily approachable then choosing a full-service broker like Motilal Oswal could be more beneficial.

Last but not the least, to check the broker’s sustainability and reliability it is good to look for how it deals with its clients’ queries.


As per the above information, it is now clear that Motilal Oswal remains active in resolving the client’s queries and hence is a better broker when it comes to offering satisfactory services to its customer. 

5paisa Vs Motilal Oswal Charges 

No comparison is complete without considering the charges imposed by different stockbrokers.

Well! when it comes to comparing the charges of discount and full-service, the discount brokers seem to be more tempting, But it is needful to look for the benefits and advantages the stockbroker offers you in terms of the fees it charged.

Beginning with the Demat account charges, here is the comparative information of both the brokers.

5Paisa Vs Motilal Oswal Demat Charges 

The very first step to connect with a stockbroker is opening a Demat account.

So here, Yatish gets another differentiation factor, i.e., account opening and AMC charges of both the brokers.

After contacting the representatives of the particular firm, he found the following information.

Both 5paisa and Motilal Oswal come with different benefits for their customers by offering them different plans.

Choosing different plans of your choice further gives you the advantage of a lifetime free Demat account with no annual charges. 

But when comparing the standard AMC charges, 5paisa being the discount broker comes with the minimal AMC of ₹25 per month while Motilal Oswal charges ₹999 per year as the annual maintenance fees.

Well! On the basis of this, 5paisa seems to be a better choice. But AMC and account maintenance charges should not be the basis of choice when it comes to picking the right stockbroker. 

5paisa Vs Motilal Oswal Brokerage Charges 

Yatish wants to explore more by comparing many more services including the brokerage fees of both the brokers and hence comes with the following data. 


From the above table, no doubt 5paisa seems to be profitable to the traders? Isn’t it?

But let’s look at the different side of the picture, where Motilal Oswal is charging brokerage on the basis of turnover value but at the same time comes with different plans and offers that can benefit you especially when you are an active trader.

To understand this, let’s take an example.

Let’s suppose Yatish buys 1000 shares of XYZ company at ₹50 each and sell it within a day making a profit of ₹5 per share i.e. at ₹55.

The total turnover value of the trade is ₹1,05,000.

Since 5paisa charges flat brokerage charges of ₹20 per trade irrespective of its volume, so now let’s check how much Motilal Oswal charges for this particular trade.

Opting for the standard pack with 6,00,000 in the trading account, Motilal Oswal intraday charges are 0.01%.

Calculating the brokerage on the basis of turnover:

0.01%*1,05,000
=₹10.5

Thus, for the same trade, you can almost half of your money by paying less brokerage.

So, here concluding the above concept, although the full-service stockbrokers seem to be expensive but evaluating and analyzing their brokerage and services can actually help you in saving a lot.

Depending upon your need thus it becomes vital to go for the stockbroker that can actually meet your trading need at the least charges.

Yatish, for example, is planning for long-term trading and hence thought of choosing 5paisa as the broker due to its flat brokerage model.

5paisa Vs Motilal Oswal DP Charges 

All the investors and traders when picking the right stockbroker often limit their research to the account opening and brokerage charges.

But along with this fee, there are some other charges you must consider like the DP charges.

Depository Participant charges are the fees levied by the depositories on the sell transactions done from your Demat account.

Let’s check the DP charges of both the stockbrokers:

 

To understand the table, he made a situation.

Let’s assume he had 2 scrips, i.e., Britannia and Coal India. He bought 10 shares of Britannia and 6 shares of Coal India. Here, he drew the following situations:

Situation 1: Selling out 10 shares of Britannia and 6 shares of Coal India, 

DP charges in Motilal Oswal:  ₹75 of these 2 scrips i.e ₹150 (₹75+₹75)
DP charges in 5paisa: 12.5 per scrip i.e. ₹25.

Situation 2: Selling 3 shares of Britannia only 

DP charges in Motilal Oswal: ₹75
DP charges in 5paisa: ₹12.5

Thus, the overall DP charges in 5paisa are quite less as compared to what Motilal Oswal charged from its investors. 

This makes it even more obvious for investors to look and compare the DP charges along with the brokerage before picking the stockbroker.

5paisa Vs Motilal Oswal Margin Trading Facility

Talking about margin, then both the selected brokers offer the margin trading facility to the traders or investors. 

Margin basically acts as a loan and is the money borrowed from the stockbroker to buy the desired order and is known as the difference between the total value of investments as well as the loan amount.

So after understanding the meaning of margin, let’s now focus on the margin trading facility of both the brokers. For that, refer to the following table.


If Yatish has ₹10,000 in the trading account, and if 5paisa allows trading with 10 times margin within Intraday, then a trader can trade of at least ₹1 lakh. If in the future, the share price increases to ₹15,000, he can trade up to ₹1,50,000 and the trader will earn a profit of ₹50,000.To understand in a more efficient way, let’s assume an example.

Likewise, if Yatish had a Demat account with Motilal Oswal, in that case with ₹10,000 in the trading account, he was able to get the margin of up to 8 times which means up to ₹80,000. And if the share prices increase to ₹15,000, he will be able to trade till ₹1,20,000 and will get a profit of ₹40,000. 

So, here it is clearly seen that with the greater margin offered by 5paisa, Yatish earned more profits.

5paisa Vs Motilal Oswal Trading Platforms

It is important to understand and check the trading platforms of any broker before directly jumping into executing the order. The same has been done by Yatish to move a step ahead in selecting a reliable broker.

 

So, he found the following information on the trading platform of 5paisa and Motilal Oswal. 

By looking at the above table, it was difficult for Yatish to directly come to the outcome as both the brokers offer the additional apps to the client such as Motilal Oswal Smartwatch App (for smartwatches) and 5paisa School App (educational app).

This pointer takes the excitement ahead where Yatish gets to know that the 5paisa school app allows the traders or investors to get the educational content over the stock market. This app helps the readers in embellishing their knowledge in the share market whereas the MO smartwatch app allows the traders or investors to get reports or notifications on their wrist.

To understand the table created by Yatish in simpler terms, let’s sum it up.

 

5paisa Vs Motilal Oswal Algo Trading Platforms

In the share market, algo trading is getting success in providing signals for the right time decisions and helps in saving time and continuously checking out the screen. 

The next segment was Algo Trading platforms in the comparison’s list of Yatish, and hence he came to a decision afterward.

 

This segment too made the decision confusing and left the segment in the tie situation. For Yatish, both brokers are equal performers as both offer the algo trading platform.

 

Hence, with both the brokers, he can get the signals of the trades automatically.

5paisa Vs Motilal Oswal Research and Advisory 

It is always true that discount brokers lack research and advisory and the same was in the mind of Yatish. 

So, he arranged the trading platforms of his two friends who have Demat accounts with 5paisa and Motilal Oswal respectively (as they do not provide guest login).

So, he covered the following features available online as well as offline.

The above table clearly states that Motilal Oswal offers the daily markets, free tips, fundamentals, IPO and company reports, offline advisory, and also provides the relationship manager for any query or doubts. Whereas, 5paisa only offers the IPO reports and relationship managers to the clients.

In this facet, Motilal Oswal is a clear winner as it provides suitable reports and facilities to the customers. Hence, in this scenario, Motilal Oswal wins the segment.

5paisa vs Motilal Oswal Account Features 

The next facet in Yatish’s list was the account features of both the brokers. Here, he found and considered various aspects of the account that are listed in the following table.

After the comparison, he drew that both brokers imply the same features. For that, consider the following table.

 

Yatish saw that 5paisa and Motilal Oswal provide the facility of SMS Alert, Online Portfolio, Referral Program, Call and Trade to its customers. Hence, here both the brokers gained equal points.

5paisa Vs Motilal Oswal Customer Support

In case of any glitch, we preferred the customer support of the companies to be appreciative and so we expect with our brokers. In case of technical flaws or any other issue, we consider connecting with customer support.

So, here is what Yatish drew about 5paisa vs Motilal Oswal customer support.


To know the same, it is important to refer to the following segment.Not again!! The situation that appears here is again of a tie. Now what? In the last situation to actually come to a decision, Yatish checked the overall rating and reviews of both the brokers.

5paisa vs Motilal Oswal Which is Better?

Yatish checked by comparing that Motilal Oswal is an old broker as compared to 5paisa and other than that the services offered by them also became a differentiating factor because of their type, i.e. full service and discount broker respectively.

The other comparative factor was that the Motilal Oswal was expensive in terms of AMC and brokerage whereas 5paisa allows the charges that suit the pockets of the customers.

Motilal Oswal’s value plan is effective for the active traders who trade on the regular basis but the millennials or those who are new in the share market can go with 5paisa.

As per the above data, A Digital Blogger provider ratings to the stockbroker, which helps newbies like Yatish to choose the best.

 

Want to trade in the stock market, then it is the right time to compare, differentiate, check, and select the stockbroker.

Like Yatish, you can also check the suitability and preference according to which the selection of the broker becomes easier and reliable.

To make the beginning of the journey comfortable, get in touch with us now and open a Demat account for FREE!

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