1The following is my opinion after following NSE, BSE, NISM, and Indian Stock Markets for many years and after undertaking various NISM, NCFM, and BCFM exams. Before coming to any conclusion, let me provide you with a short history of both NCFM and NISM.
History of NCFM:
NSE’s Certifications in Financial Markets (NCFM) are practical-oriented examinations developed by NSE. The primary objective of having NSE’s Certifications was to ensure a bare minimum knowledge about financial products, trading systems, etc., and therefore, these certifications were made mandatory by NSE before registering its members on the stock exchange.
Besides, NSE, as a stock exchange, also wanted to educate the securities market participants and the Indian community as a whole about various aspects of the Indian Stock Market. They started this initiative on a large scale in the form of NCFM Certifications and were successful in doing so. However, considering the fact that Indian market participants were not so mature and professionalized, the level of difficulty for most NCFM Certifications was kept low. Soon, it became very easy for people to clear these certifications.
Why NISM was born?
As the number of NCFM exam takers increased, NSE saw these certifications as a money-minting machine and decided to continue with its low difficulty level. Other stock exchanges, namely, BSE and MCXSX (now MSEI), also launched similar certifications and made it mandatory for their members to have these certifications before registering on their respective stock exchanges.
Soon, SEBI sensed that brokers/members were now required to undertake multiple certifications to register themselves on the stock exchange, i.e., NCFM Certification for NSE, BCFM Certification for BSE, and so on. SEBI, therefore, took the initiative of having a common certifying body for certification of people working in Indian securities markets, and NISM was assigned this responsibility. Thus, NISM Certifications was born in 2009.
What are NISM Certifications?
NISM Certification Examinations are the most authentic, practical, and mandatory certifications available for various areas of the Indian securities market. The certifications are mandated by SEBI under SEBI (CAPSM) Regulations, 2007, which themselves give them the necessary credibility. What this means is that all brokers, members, mutual fund distributors, traders, dealers, and other market participants who were earlier required to pass the exchange level examination (i.e., NCFM, BCFM, etc.) are now required to pass a single NISM Exam to access the stock exchange’s broker terminal.
Exam Maintenance:
Unlike NCFM Certifications, which have not been revised for ages, NISM Certifications undergo regular maintenance and are updated regularly. Personally, I have seen every exam getting updated once every year.
Study Material:
Study Material for NISM Certifications is available free of cost in soft copy format and also for purchase at economical prices across various bookstores as well as online. I recently tried to purchase study material for one of the NCFM Certifications and I am still clueless about where to find it.
Regular Updates:
Ever since I passed the NISM Certification Examination, I have started receiving regular updates from NISM about any new updates regarding the products or regulations. These updates keep us informed about the market.
Recent Trends:
Lately, almost all brokers, traders, dealers, merchant bankers, mutual fund distributors, derivatives dealers, and other market participants have already moved to NISM Certifications. There are hardly any takers from market participants for NCFM Exams these days.
NCFM, however, still continues to milk the cash cow through their sales teams. There has been a shift in strategy, though. Instead of targeting capital market participants, NSE now sells NCFM exams by packaging them as knowledge-oriented exams to college students at graduate and undergraduate levels.
Conclusion:
IMHO, it may make sense for a college graduate to undertake an NCFM exam, but he/she may rather take a practical, authentic, updated NISM Certification Exam as it will provide them a license to work in the market.
While NSE's NCFM lacks updates and the required rigor, NISM fills the gap with updated, authentic, and practical certifications.
Useful Links & Sources:
NISM Certification Examinations
Free NISM Mock Tests
Premium NISM Mock Tests
NISM Study Material Download
In case you have any feedback about the above article, please write your comments below.
This article was originally posted at PrepCafe Blog as Which Certification Exam is better - NISM or NCFM?
About PrepCafe:
PrepCafe provides NISM Mock Tests / NISM Practice Exams, Study Material, and related content to help you pass real NISM / NCFM Certification Examinations. All our examinations are of premium quality and moderately priced. You can purchase our NISM mock exams after one-time registration on our website www.PrepCafe.in. We hope that you will find these exams useful in passing your NISM Certification Exams.
From India, Mumbai
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NISM is a mandatory exam.
NISM mock test papers are available at www.modelexam.in.
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NISM mock test papers are available at www.modelexam.in.
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