A : Only those companies which are already listed in the securities list of depositories can dematerialise their shares.
A : Depositories provide a number of benefits like:
- Immediate transfer of securities.
- No stamp duty on transfer of securities.
- Elimination of risks associated with physical certificates such as bad delivery , fake securities , etc.
- Reduction in paperwork involved in transfer of securities.
- Reduction in transaction cost.
- Nomination facility.
- Changes in address recorded with DP gets registered electronically with all companies in which investor holds securities eliminating the need to correspond with each of them separately.
- Transmission of securities is done by DP eliminating correspondence with companies.
- Convenient method of consolidation of folios/accounts.
- Holding investments in equity, debt instruments and Government securities in a single account.
- Automatic credit into demat account, of shares, arising out of split/consolidation/merger etc.
A : The dematerialisation process normally takes between 15-30 days.
- Opening the demat account.
- Dematerialisation i.e., converting physical certificates to electronic form.
- Rematerialisation i.e., conversion of securities in demat form into physical certificates.
- Facilitating repurchase / redemption of units of mutual funds.
- Electronic settlement of trades in stock exchanges connected to NSDL.
- Pledging/hypothecation of dematerialised securities against loan.
- Electronic credit of securities allotted in public issues, rights issue.
- Receipt of non-cash corporate benefits such as bonus, in electronic form.
- Freezing of demat accounts, so that the debits from the account are not permitted.
- Nomination facility for demat accounts.
- Services related to change of address.
- Effecting transmission of securities.
- Instructions to your DP over Internet through SPEED-e facility. (Please check with your DP for availing the facility).
- Account monitoring facility over Internet for clearing members through SPEED facility.
- Other facilities viz. holding debt instruments in the same account, availing stock lending/borrowing facility, etc.
A : An investor needs to fill an account opening form for opening a demat account. The DP-Client Agreement provides the details about the rights and duties of investors and DPs.Along with the account opening form, investors have to submit the following documents:
- Proof of Identity : Investors signature and photograph must be authenticated by an existing demat account holder with the same DP or by your bank. Alternatively, investors can submit a copy of Passport, Voters Id Card, Driving License or PAN card with photograph.
- Proof of Address : Investors also have to submit a copy of Passport, Voters Id Card, Driving License or PAN card with photograph, ration card or bank passbook as proof of address.
- Passport-size photograph : The investor has to carry all original documents to the DP for verification and should obtain a copy of the agreement and schedule of charges for future reference.