How to open a Demat Account Online
With the increase in disposable income now people are interested in making investments in stock markets. But the very first question that clicks into the mind of every potential investor is How to Open a Demat Account online? Well, we are living in a world where everything is just a finger touch away from us. Be it shopping, study, banking, business or jobs; each and every task can be executed online with great perfection and without any hassle.
- Opening a demat account online is really an easier task, read ahead to know the whole process:
- The very first step is to approach depository participant, also known as DP with whom you are interested in opening your Demat account. A DP can be a broker, bank or any depository participant who plays the role of an intermediary on behalf of depository.
- The second step is fill up the Demat account opening form accompanied with KRA-KYC if not done earlier with all the necessary documents mainly self attested copy of PAN Card, address proof, identity proof (if name differ in pan card such as passport, driving license, voter id, etc.) and a self attested passport sized photograph.
- If KRA-KYC is already done there is no need to submit KYC documents again, only filling PAN and date of birth in Account Opening Form of DP shall be sufficient. Any one can get information about his KYC status with KRA viz., from website www.cvlkra.com under meanu 'KYC Enquiry'.
- Third step involves viewing “Rights & Obligation of B.O. and DP” and signing of acknowledgement there of which is rules and regulations clearly stated which are significantly followed by the DP and investor both.
- Once you sign the Account Opening Form and verification of KRA-KYC and related documents is completed, you will get access to your Demat account within 15 days. You will receive your BO ID which is beneficiary owner's identification number. This is your Demat account number which is used to do any kind of Demat transactions.
Now your account is Active and you can step into the world of investments.
Note: Demat account does not require any number of securities. The account can be opened with zero balance without any obligation to minimum balance for account maintenance
Account opening charges
Opening Demat account does not levy any charges. However, some banks/DPs may charge annual fee at the time of account opening. It is advisable to check for any charges before proceeding for Demat account opening. KRA-KYC charges may be levied which is one time charge of approximately Rs.50/-
Annual maintenance fee
Annual fee is charged for folio maintenance and it is charged in advance. Maintenance fee can be low or high depending upon the services your DP is offering.
Transaction fee
Transaction fee is levied on share trading. Whenever you buy or sell, brokerage would be liable to pay some amount that depends upon the scheme you have opted. DP charges Transaction Fee on percentage basis which may range to 0.05% of the value of transaction subject to minimum sum ranging from Rs.20/- to Rs,50/- on sell, i.e., debit transactions. Credit transaction in DP is free.
Dematerialisation fee
It is charged if you want to convert your physical forms into demat (electronic) form. Dematerialisation fee is not levied on all account holders but it is applicable for those who opt for the option of converting physical shares into demat form.
Opening demat account online makes it easier to have a holdover you securities. And the best thing is you can work from anywhere if you have online Demat Account.
- 5 things to check at the time opening a Demat Account
1 DP Credentials:
Check the credentials of the DP. Find out since how long they have been DP. Are there any investors complains against the DP (List & no of complaints against DP is readily available at https://www.cdslindia.com/investors/investor-complaints.aspx & https://nsdl.co.in/nsdlnews/investors-complaint-status-arbitration-details-penal-actions.php).
2 Verify your details:
Always check the confirmation letter issued by DP. Please ensure that mobile no., email id, address, bank, nominee, & other details are consistent with details provided at the time of account opening. Intimate any change to your DP Immediately.
3 POA :
If you are giving a POA/LOA, Please ask for the details of the beneficiary account to which the shares will be transferred. Ensure POA/LOA is for specific purpose only; carefully examine the scope and implications of powers/authority being granted.
4 Operation of Your DP-BO Account:
Verify your transaction statement carefully for all debits and credits in your account. In case of any unauthorized debit or credit, inform your DP or CDSL Immediately. Ensure that, both, your holding and transaction statements are received periodically as instructed to your DP. DIS: the Delivery Instruction Slip (DIS) book is like your bank cheque book. Keep your DIS book safely and do not sign or issue blank or incomplete DIS slips. For market transactions, submit the DIS ahead of the deadline time, DIS can be issued with a future execution date. Register for CDSL's internet based facility “easiest” to monitor your demat account; to verify your holdings & to submit off-market, on-market, inter-depository and early pay-in online instructions from your login by using Internet facility from anywhere/anytime. Also don’t forget to register for SMS alerts (SMART) facility provided by CDSL, to receive transaction alerts. Contact your DP for details.
5 Transaction Charge and AMC:
Check the transaction charges and AMC being levied by DP. Some DP’s charge one time AMC while others charge on yearly basis. Choose a plan that best suits your requirement. Don’t fall victim for free Demat accounts, there may be higher operational charges associated with free account opening.
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