Zerodha “Scam” Row Explained: Why an Investor’s Rs 18 Crore Withdrawal Triggered a Debate on Financial Limits

Nithin Kamath said the ₹5 crore limit was part of standard operational checks to ensure system safety and prevent financial risks.

A social media post by Mumbai-based investor and IVF specialist Dr. Aniruddha Malpani has stirred discussion in India’s fintech and investing circles. Dr. Malpani, who runs Malpani Ventures, accused India’s leading brokerage Zerodha of blocking his attempt to withdraw his own funds — an allegation that he termed a “scam.”

According to Malpani, Zerodha’s platform restricted his withdrawal to ₹5 crore per day, despite his demat account showing a withdrawable balance of over ₹18 crore. Sharing screenshots from his Zerodha dashboard on X (formerly Twitter), he wrote:

“The Zerodha scam! They don't allow me to withdraw my own money from their account, saying the daily limit for withdrawal is ₹5 crores. They use my money for free. This is unfair.”

The screenshots revealed an account value of over ₹42.9 crore, with ₹24.4 crore used margin and ₹18.4 crore withdrawable balance.

Zerodha Responds

Following his public post, Zerodha’s support team responded promptly on X, clarifying that the platform indeed has a daily withdrawal cap of ₹5 crore, as part of its standard operational policy. They explained that larger withdrawals can be facilitated by raising a support ticket through the official portal — a process designed for verification and security.

Dr. Malpani confirmed that he had already raised such a ticket and shared proof of submission. Zerodha assured him that his request was being reviewed.

Nithin Kamath Clarifies the Policy

Soon after, Nithin Kamath, co-founder and CEO of Zerodha, personally addressed the issue on X. He confirmed that Malpani’s payout requests had been processed and explained that the ₹5 crore withdrawal cap exists as a security and risk control measure, not a restriction on access to funds.

“Hi Dr, your payout requests were processed yesterday. We need to ensure, for the sake of our systems' sanity (like all other financial services firms), that we have some checks in place when clients withdraw funds. As you can imagine, numerous potential issues can arise during the withdrawal process, and once funds are paid out, there is no way for us to recover them,” Kamath wrote.

He added that the ₹5 crore threshold acts as a checkpoint to flag unusually large transactions and ensure due diligence before funds are released.

Industry Experts Defend Zerodha

Several financial experts backed Zerodha’s stance, calling such limits standard practice across the financial industry.

Ajay Rotti, Founder & CEO of Tax Compaas, commented that the restriction is a protective measure rather than a scam:

“It isn’t a scam. I would rather deal with a broker who has controls like these and prevents actual scams of someone cleaning up my account in a day.”

He compared Zerodha’s daily limits to withdrawal limits in banks and UPI transactions, saying such controls are necessary to mitigate fraud and ensure system security.

What Are Zerodha’s Current Withdrawal Rules?

As per Zerodha’s policy:

Maximum daily withdrawal limit: ₹5 crore

Instant withdrawal limit: ₹100 – ₹2,00,000 per day (available 9 a.m. to 4 p.m.)

Larger withdrawals: Can be processed via manual request (support ticket)

Eligibility: Subject to the available withdrawable balance in the trading account

The Bigger Picture

The controversy underscores the fine balance between user convenience and financial security in online trading platforms. While investors like Dr. Malpani argue that such restrictions limit access to one’s own funds, companies like Zerodha maintain that these measures are crucial to protect clients and the platform from systemic or fraudulent risks.

Ultimately, this incident highlights how transparency and communication play a vital role in maintaining trust between brokers and investors — especially when millions of rupees are at stake.