So, you have decided to move on and close a demat account with your stockbroker! Well, that can surely happen. Trading on the stock market can be excruciating and can take a lot of toll on you physically as well as mentally.
Unlike Account Opening process, account closure is relatively a tedious task. For instance, when you opened the account, the stockbroker might have called you multiple times to get one single meeting; even if you were sitting at farthest places of the country. On the other hand, to close a demat account – you either need to send the signed document through a courier service or visit the branch personally.
Nonetheless, there are few formalities you need to take care of in order to close a demat account with your current stock broker.
Things to take care before you close a Demat Account
Here are some of the important points you must take care of before you go ahead and close your demat account with the current stockbroker:
No shares must be present in the demat account you are looking to close. They either need to be sold out or transferred to some other demat account. One can also get the stocks rematerialized into physical form.
No negative cash balance in your account must be there.
You are also required to submit the unused delivery Instruction booklet slip back to the DP
Once these formalities are taken care of correctly, you need to either send the account closing form through a courier or visit the branch or franchise personally. Post submission, it takes your DP 2 to 3 business days to close a demat account. Remember, there are no extra charges to close a demat account apart from your balance.
You can get your shares transferred to some other demat account you might have. You would need to fill up and submit the details of the depository participant along with notifying the DP itself that new shares are going to be allocated to your demat account. Generally, it takes 3 to 5 business days for this transfer to take place between demat accounts.
Here we are providing you links to forms of all the prominent stock brokers that you need to fill up and submit in order to close a demat account.
Discussing further, some of the top reasons why someone generally chooses to close his/her demat account are:
Stock trading does not seem to be their cup of tea anymore and the interest has died down
Trading takes a lot of toll on one’s life physically and mentally
Bad experience with the stock market behaviour
Bad experience with the stockbroker
Nothing much can be done in case your reason to close a demat account lies in the top 3. However, unfortunately, if you have had an unhappy experience with the stockbroker, we advise you to take a step back and try to contemplate on the specific aspects where you found your stockbroker relatively less competent for you specifically, be it –
High Brokerage charges
Sleazy Customer service
Slow and low-quality trading platforms
Once you are able to narrow down to the specific concerning aspect(s), it becomes relatively easier to figure out a better substitute stockbroker.
We suggest you check out this detailed review of the Top Stock Brokers in India for reference that discusses different full service and discount stock brokers from different perspectives.
Still not sure on how to close your Demat Account?
Why don’t you send your details and we will arrange a Free Call back for further guidance!