Why do you need a Demat Account?
Posted by NriFinanceGuide on January 29, 2009
Before we understand the function of a dmat account, we first need to know what is a demat account? Well a demat account with a broker can be considered as a bank account. The way we keep money in the bank account the same way we keep our stocks in a demat account. Such a demating account is opened by a broker and held at a DP – depository participant. A DP can be a stockbroker or a bank, and you need to file a dematerialization request form to get your physical shares dematerialized. Once the dematerialization form is received by the DP, an NRIs account is opened with no delay. Later the same demat account is connected to a trading account through which NRIs can buy and sell Indian shares using the money that is parked in their NRE PIS or NRO PIS at a designated RBI approved bank.
How can one go about Opening a Dematerialized Account?
First, you need to find a DP (depository participant). You can find lists on them on the internet. A recommended web site is the website of Central Depository Services Limited. After you have found a DP, then, you need to fill out the necessary forms for opening an account. After this, the DP will ask you to sign an agreement. You need to remember that you will also be asked for proof of identity and address. This could be a passport or an identification card. If you are an Indian citizen, you will need to have a PAN. In case you do not have one, you can get one at PanCardNri.com
What are related Demat account charges?
The Dematting charges depend upon which DP you decide to go with for demating your existing shares. If cost is and issue for you, you should do some research before deciding on one. Once you have opened your Demat account, the DP will give you a BOID (Beneficial Owner Identification Number). You will use this number every time you make a transaction by buying and selling stocks using your NRI account for dematerialization. Every time that you would like to sell your stocks, you need to talk to your broker and your DP as well.
Your DP will keep your Demat account updated. Every time you want to buy shares, you need to tell your Demat account number to your broker. India’s stock markets are doing very good and growing very rapidly. There are many investment opportunities that you would get with investing in India. A Demat account will help you in getting started with investing in India.
Why do you need a Demat Account? | No Brainer Profits said
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shahnawaz abdullah wani said
i have applied for pancard from last 4 weeks my Akno. Is 881020110832514 what is my pan number