New Delhi, Aug. 27 -- For consumers, borrowing money to invest can be far riskier, as market losses can quickly turn a leveraged investment into a financial burden.

Margin Trading Facility (MTF) allows investors to purchase shares by paying only a portion of the investment upfront, while the broker funds the rest. This can increase an investor's market exposure, but it also means higher risk if share prices fall.

Let's look at why Zerodha Founder and CEO Nithin Kamath is becoming increasingly cautious about the MTF.

"With the start of the MTF (margin funding) business in Dec 2024, there's been some predictability in revenue, since we earn interest income on it. MTF currently makes up ~10% of our revenue," Kamath mentioned in his note t...