A Guide on How to Open a Demat Account
Many of us are much aware of the term called Demat account. For the ones who aren’t, the Demat account is an account that helps in converting the physical shares into electronic form. This term is popularly used in the world of trading and investments. In this era, many of us prefer to have high returns with high risks. But the physical holding of the securities and tracking and monitoring the securities can be a tedious task. So here a Demat account will help you out and will make your selling and purchasing shares much easy.
In India, people have jumped to stocks leaving behind the traditional instruments for savings. This has increased the need for a Demat account and on all the above, SEBI has made it mandate to hold a Demat account for stock market trading. So increasing the demand for Demat accounts has led the depository participants to offer the Demat account at less possible costs. Also, know that, that India has two central depositories i.e. NSDL and CSDL which are registered with the apex trading and investment regulatory body SEBI. So here it becomes important for the depository participant or the intermediaries to be registered with one of these licensed operators. Your Demat account will be a 16-digit ID which will be the identity of the account holder. The first eight digits will represent the depository participant and the next eight will be the unique identification number of the account holder of sale or purchase of the securities. Though it might sound tough, it is very easy to open a Demat account online. So for safety, convenience, accessibility, lower charges and to track and monitor multiple securities, it is important to open a Demat account.
Following steps is the step by step guide on how to open Demat account:
- Apply for a Demat account online- Look for a trustworthy depository participant and apply for a Demat account by submitting your mobile number and email address.
- Fill in your details- The next step is to fill in the details i.e. Know your customers (KYC). Make sure to fill in all the genuine details. You can fill in the details directly on their website or even on their application if they have one.
- Documents verification- Once all the documents are uploaded, the depository participant will verify the documents to ensure that there is utmost transparency. Some of the documents that will be required are- identity proof, address proof (passport, adhaar card, driver’s license, electricity bill, ration card, gas bill etc.), bank account proof and income proof.
- Get your beneficiary owner identity- Once you go through all this documentation and your DP approves it, you will get your Beneficiary owner identity (BOID). Now you successfully have your
Demat account and you can convert all your securities in electric form.
So above is the step by step guide which will help you to open the Demat account. Here ‘5paisa’ will help you to open the Demat account as it is an online discount stockbroker. It will make your investments hassle-free for everyone.