If you are well versed with the stock marketor even if you have just started developing interest in the field, it is essential to believe in the necessity of a demat account. So, are you curious to know about NSDL demat account?
If yes, then you are at the right place. In this article, we will cover all the details and essential things that you should keep in mind for a demat account in NSDL.
But just as before building a building, the formation of a base is essential.
Similarly, before starting the discussion about the NSDL demat account, let us first understand what the meaning of a demat account is.
Demat account is an electronic storehouse of all your securities, be it equity shares or bonds. Before introducing the demat account, all the shareswere stored in a physical form which made it extremely difficult for the investors to keep track of.
With better safety and security, the easy transfers come as an added benefit with a demat account. After the opening of a demat account, you can officially start trading in the stock market.
In this article, we will cover the major points that include,
NSDL demat account
NSDL demat account opening
NSDL demat account login
NSDL demat account charges
Now that we are aware of the meaning of a demat account let us dive into the NSDL demat account meaning.
NSDL Demat Account Meaning
If you want to understand the NSDL demat account details, it is crucial to get a closer look at the meaning of NSDL. Here is a lot more that can be known about NSDL demat account from here too.
National Securities Depository Limited is a depository in India. Similar to opening a bank account, when you want to open a demat account, you go to the Depository Participant(DP), who in turn is registered with the depository.
Currently, there are two depositories in India, NSDL and CDSL. When we talk about NSDL Demat Account, it is not the NSDL that is directly linked with the opening but the Depository Participant.
When you wish to open an NSDL demat account, all you have to do is check the depository participants registered with NSDL.
Many stockbrokers function as depository participants as well. In such cases, you can also approach your trusted broker and ask whether they are registered with NSDL or not.
Many stockbrokers and depository participants have registered with NSDL because the market is growing each passing day.
The increasing and widely spreading network of financial service provides, like banks, financial institutions, custodians, etc., allows NSDL to reach more investors covering broad geographical areas.
If a financial service provider wants to become a depository participant with NSDL, they must undergo a detailed evaluation by NSDL.
They also have to get a green flag from SEBI (Securities and Exchange Board of India).
There are many benefits of the NSDL demat account and also various ways in which it can be put to use. Some of the services of an NSDL demat account are as follows.
The demat account can be used to hold and purchases all kinds of securities, including shares.
Now that we know that we cannot directly approach NSDL for opening a demat account, but we have to approach an intermediary Depository Participant who will open a demat account.
The NSDL demat account opening procedure is a simple and not at all cumbersome process. Let us look at the steps you should follow to open a demat account in NSDL.
The first step for opening an NSDL demat account is to approach the concerned Depository Participant. You can easily see which Depository Participants are linked with NSDL by simply visiting their website and choose the one that matches your needs.
You can kick off yourself too:
Now you will be required to fill a form and, along with that, submit some documents. These include your PAN card, your address proof, and also the details of your bank account.
There will be a mandatory verification of the documents once you submit all the necessary documents to the Depository Participant or DP.
After the successful verification, your demat account will be opened.
After the successful NSDL demat account activation, your Depository Participant will provide you with your demat account details. These details include:
Client master report (contains all the necessary details of your demat account)
‘Right and Obligations of the Beneficial owner and Depository Participant.’
The DP ID is an eight-digit code that the NSDL allots to all the associated DPs.This aids the process of identification.
You should also make sure that you check the Client master report to ensure that all the details are correctly registered.
Following the above steps, you can easily open an NSDL demat account and enjoy the various services.
Apart from the demat account opening charges, there is also some NSDL demat account AMC charges. Account maintenance charges the charges charged on an annual basis for the maintenance of your demat account.
The trading account will not have an Account Maintenance Charge. You open a demat account with a Depository Participant of your choice and according to your convenience.
Therefore, just like the demat account opening charges, NSDL is not directly responsible for charging AMC to maintain your demat account.
Different DPs or stockbrokers charge different Account Maintenance Charges. Let us discuss some of them in brief.
These are the Account Maintenance Charges that will be levied on opening the NSDL demat account.
NSDL Demat Account Login
Once you have successfully opened a demat account, you now need to know the process of logging in to the demat account.
The NSDL demat account login process is as follows.
Open the NSDL website.
Here, you will be required to fill a registration form.
Enter your DP ID (as provided by the DP) and your client ID.
Now you need to enter your username and password.
After this, you will be successfully logged into your demat account.
By following these simple steps, you can easily log in to your NSDL demat account.
There are cases when a user can also skip on the password. What should you do in such a case? How will you login? Fortunately, there is a solution for this as well. In a case where you forget the password, you can log in following the given steps.
When you open the log-in screen, there will be a ‘forget password’ link. Click on that.
Now enter your DP ID, user ID, and client ID. Now click on generate OTP.
You will receive a one-time password on your registered mobile number. Enter the OTP, and enter submit.
After the submission of the OTP, a change password screen will appear.
Enter your new password and submit.
Once you have successfully changed the password, you can easily log in to your demat account.
When we open an NSDL demat account, we open a demat account with a Depository Participant registered with NSDL.
If you want to open a demat account in NSDL, then you have to approach the DP of your choice and fill the registration form. Along with this, you will also submit proof of identity, proof of address, bank account details, and photographs.
The process is easy, and the benefits are many. When it comes to NSDL demat account charges, then NSDL is not responsible for directly charging the amount but is done by the intermediary in between.
We hope that the concept of the NSDL demat account is now clear to you, and you will not face any problem in opening one now.