Steps to Open Online Demat Account
Your stocks, bonds, and other securities are stored in a dematerialized or electronic form in the Demat account. A Demat account was needed after the Securities and Exchange Board of India (SEBI) ordered that shares and securities be dematerialized. The Demat account is like a bank account, where you receive credit or debits when buying or selling securities. The depository participant (DP) maintains the account, serving as an intermediary between the investor and the depository.
An Online Demat account is a safe and convenient way to store securities electronically, eliminating the need for physical certificates. It also reduces the risk of loss or theft of securities and fraud. With an Online Demat account, you can easily buy and sell securities online, track your investments, and automatically receive dividends and bonuses. The process of pledging securities as collateral for loans will also be simplified.
In today’s technological world, you can easily open a Demat account online through a stock trading app just by sitting at home and without any paperwork. To learn about the various steps to open demat account online, follow the article below.
Steps for Online Demat Account Opening
The various steps involved in opening an online Demat account are as follows.
Step 1: Go to your bank or stockbroker’s website. However, look at it before you do.
Step 2: Complete the Demat account opening form that your DP provides on its website. Remember to check for errors before submitting it. Also, complete the KYC (Know Your Customer) by providing all the necessary scanned documents.
Step 3: When you are finished, click submit. If the company requires additional information before completing its review process, it will contact you via email or phone in 48 hours. They should inform investors that their application has been approved as soon as possible. Such a decision has no time limit, but it usually takes less than seven days.
Step 4: Once your Demat account has been activated, you will receive a confirmation letter or an email.
Step 5: The brokerage firm will issue the login credential via the registered email or mobile number. They will enable you to use the Demat account and begin your investment journey.
Eligibility Criteria to Open an Online Demat Account
Anyone 18 and an NRI from India can open a Demat account. To open an account, you must provide proof of your identity, address, and PAN card. NRIs and OCIs may also need to submit additional documents, such as a copy of the passport or evidence of an overseas address.
First, select a DP, complete the account opening form, and send the required paperwork to the DP. PAN cards, addresses, and identity proof are required. After you have provided these documents, you must verify your identity and link a bank account to the Demat account.
Demat Account fees
The Demat account is subject to various fees, such as opening a new account, annual maintenance charges, or transaction fees. The costs usually vary from one DP to another. Fees for pledging securities, reactivating accounts, and closing accounts may also be added. Before you open a Demat account, knowing what fees affect your returns and how they can affect your investment strategy is essential.
Managing the Demat Account
One of the most important ways to maintain your demat account is to regularly check your account statements and look for unauthorized transactions or discrepancies. If you notice any red flags, notify your broker immediately. After that, make sure your contact details are updated with the DP. You will receive timely updates and notifications about your Demat account. You can also change your password frequently to protect your Demat account against unauthorized access. Don’t give anyone your login credentials, and don’t log in to your account from a public computer or an insecure network.
Conclusion
You can follow the steps in this guide to obtain all necessary documents and information before starting the application process. Selecting a reliable stockbroker is essential, as they will be responsible for holding your securities and managing your investments. Using a Demat account, you can quickly and conveniently invest in stocks, funds, and other securities. You can go for a Demat app download from a trusted firm like IIFL Securities to open a hassle-free Demat account on your mobile phone. The app provides all the features you will need while trading. Moreover, you can trade in different market segments with just one account.
