How to Open Demat Account:
If you want to step into the stock market, then you will need a Demat account for this, without a Demat account you can not work in the stock market. In this post, we are going to show step by step process about how to open a Demat account.
Demat account means “Dematerialization” which means depositing, transferring, and storing securities securely in digital form. To secure shares digital a Demat account required for their transactions.
SEBI made rules very strict to open a Demat account so that no person can track your data in any other way. According to the SEBI guidelines, the shares can not be sold or purchased in any form other than Demat. So if you want to buy or sell stocks from the stock market then you need a Demat account. To open a Demat account in India, there are two depositories.
- NDSL (The National Securities Depository Limited)
- CDSL (Central Depository Services (India) Limited)
However, to open a Demat account, you do not need to go directly to these agencies. There are many brokers available in the market. There are many options available in the market to open a Demat account.
Nowadays almost all banks offer the facility of opening a Demat account or there are a lot of stockbrokers available in the market which offer to open a Demat account, some of which are full-time stockbrokers and some are discount stock brokers.
A Demat account can open in two ways:
How to open Demat account Online:
If you want to open the Demat account online, there are many brokers in India. Nowadays every bank has a Demat account. You can simply visit the bank website. We have listed some banks below.
- ICICI Securities Ltd.
- State Bank Of India.
- HDFC Securities Ltd.
- Axis Securities Ltd.
- Kotak Securities Ltd.
To open a Demat account, you have to pay some Charges. There are many types of Charges.
- Annual Maintenance Fees.
- Protective Duty Fees.
- Transaction Fees
Offline Demat Account:
If you want to open the Offline Demat account than any Depository Participant, then you have to contact a broker of NSDL or CDSL. You have to fill the form, attach your photocopy and some documents for proof of identity and your address proof.
In addition, you have to sign on the agreement as an investor. Once the process is done, you will get your Demat account number. It is also called Beneficial Owner Identification Number.
Benefits of Demat Account:
The Demat account changed the completed process of the stock market, the process can be done easily. Your transactions will be secure and easy. By the Demat account, there are many benefits to the market.
- Complete Digital format: You can store your shares online.
- Some Demat accounts will provide you accounts without no charge. Whereas some will charge less amount.
- You can buy and sell in a single Demat account from different companies. The Demat account is completely secure. You can make your transactions very easy.
- It will prevent duplicate shares, misdistribution, frauds, etc.
- It reduces paperwork and provides the facility to collect and transfer shares digitally.
Demat account Fees:
Some fees required to open a Demat account, which is paid individually by different banks, stockbrokers, and an annual maintenance fee after opening the Demat account. You have to pay once a year. To open the Demat account, there is no need to spend a lot of money, just a small amount of 300 – 700 Rs enough to start investing in shares.
The fees charged for managing the account are Annual Management fees. The company takes this fee in the beginning and manages the account throughout the year.
Working on Demat Account:
Once your document verifications completed, you will get an account login ID and Password in your mail. Then you Buy/Sell/Hold shares that you bought.