Definition - What does Aggregate Indebtedness mean?
Aggregate Indebtedness is the total amount of the firm’s unsecured liabilities and customer related debts.
Testopedia explains Aggregate Indebtedness
Aggregate indebtedness (AI) is composed of the firm's unsecured liabilities and also customer related liabilities. AI has a direct correlation to the firm's minimum net capital requirement. A general securities firm must have minimum net capital of $250,000. However, that requirement may increase, as the firm can have no more than $15 in AI for every $1 of net capital. That ratio is even more stringent for a first year broker dealer; it can have no more than $8 in AI for every $1 of net capital. So it is foreseeable that a firm's minimum net capital requirement could far exceed $250,000 if the firm carries a lot of AI on its books.