Exchanges are designed to be default tolerant. They function in a manner whereby, the exchange is counter-party to all transactions. As a result, a transaction is always consummated even if either the buyer or the seller fails to honour his commitment. This is ensured through a system of margining that is fool proof. The payment crisis at the National Spot Exchange Limited (NSEL) in 2013 involving Rs. 5,600 crore therefore was shocking. As investigations revealed the reasons for the crisis lay in the hubris of the promoters, connivance and collusion of the independent and institutional directors on the board of NSEL, benevolence of the government and ambivalence of the regulator. The failure raises serious concerns about governance at all levels in the country. Fundamental principles of governance were given a short shrift.