It can be difficult to say farewell to the old ways of life. Not so in the world of trading. The transition from physical to electronic trading has been quite smooth for the Indian stock exchanges. Such trading takes place via the Demat account, which stores all your securities in the electronic form. Any transaction through this account is completely paperless and does not take any extra time.
Are you willing to take advantage of the upbeat stock market? It’s plain and simple: Just open a Demat account and start trading.
How to open a Demat account Online?
How to open a Demat account – This is one of the most common questions among people who are new to trading or want to align their financial investments plan. Here’s the complete step by step process to open a Demat account for beginners –
- To open a Demat account, you need to choose a depository participant (DP). Several banks and brokerage firms allow you to open a Demat account.
- Next, head out to your preferred DP and collect an account opening form. Key in the details and submit it along with copies of necessary documents. Do not forget to carry the original documents for verification.
- Next, you will be provided with an agreement. This would inform you about the rules and regulations, terms of the agreement, and the related charges.
- There will be an in-person verification to confirm the details of the application form.
- Once your application is processed, you will get an account number and a client ID. You can use these credentials to access your Demat account online.
Features of a Demat account
Easy share transfers: Earlier, it used to take almost a month to transfer physical shares. But the buying and selling of shares have become quick and hassle-free with Demat accounts. Besides, there is no stamp duty charge on the transfer of shares.
Easy access: Demat accounts are operated electronically. So, it is easy to have quick access. You can get the details of your account using a computer, a smartphone, or any other smart device.
Easy dematerialization of securities: Do you hold securities in the physical form? You can always place a request with the DP to convert them into the electronic form. Similarly, electronic stocks can be converted into physical ones, if required.
Freezing Demat accounts: As a Demat account holder, you are given the option to freeze your account for a certain period. This is helpful if you want to block any unanticipated debit or credit in your Demat account.
Things to remember:
- You need to pay some charges for holding a Demat account. This includes charges like the annual maintenance fee and transaction fee. The charges are different for each DP.
- Some DPs offer a flat rate for every transaction. But many others charge on the transaction value. Your intent—whether buying or selling shares—also influences the charges.
- Any conversion of physical shares to the electronic form would incur charges.
- You can open a Demat account with zero shares. Also, there is no cap on the minimum balance.
- You need certain KYC documents, such as identity proof (PAN card, Aadhaar card, driving license) and address proof (passport, Aadhaar card), along with a passport-size photograph.
Opening a Demat account helps you in a number of ways. It offers you a wide range of investment options starting from equities to debt to insurance. Just do some research before choosing your DP. To open a Demat account with Kotak Securities, click here.