Different Ways to Open a Demat Account


What is a Demat Account?

Opening a demat account is mandatory for investors to trade in the share market. A “demat” account or a dematerialised account is an electronic account that lets an investor trade in certain financial instruments, such as equities, commodities, gold, IPOs, bonds, Government securities, and more.It eliminates the hassles to maintain hard copies at the same time and is 100% secure. It provides an electronic platform that not only lets the investor trade but stores all the information like financial transactions, earnings, losses, and balance amount for the investor. The demat account holds the underlying assets or financial securities you invest in while a trading account lets you trade in these securities.

Opening a Demat Account

The first question that comes to our mind as a beginner is how to open demat account.Well, you must know that there are three accounts that you will need to start investing in the share market. A registered bank account for real-time transactions, a demat account, and a trading account that will allow you to “trade”. Trading simply means buying, holding, or selling equities or other financial instruments in the stock market. A demat account will allow investing in equities, bonds, securities, commodities,IPOs, and many more. The stock broking agency that you choose will help you with opening a demat account and a trading account. You can also have the option to have a 3-in-1 account to avoid the hassle of maintaining three accounts at a time.

To put it simply, opening a demat account is a 4-step process, Selecting a Depository Participant (DP), Filling up the application form, Verification, and Approval. It can be done both offline and online. Just remember to keep your KYC details and ID proofs ready to speed up the process.

Types of demat account

There are majorly three types of demat accounts available for investors in India based on their location. A regular demat account is for investors residing in India. It restricts the investor from international fund transfers. A Repatriable and a Non-repatriable demat accounts are for NRIs. The difference between the two is in the latter facilities like international fund transfer aren’t available. If you are a resident of India, the regular demat account will be the only choice for you.

Benefits of a demat account

When you open demat account, there are certain benefits that you come with it. Here is a list of benefits:

  1. You can trade at your own convenience with a few clicks on your device
  2. No lengthy paperwork involved with each transaction
  3. You can readily access all financial detail, transactions, trading history and account balance in one place
  4. You get notifications and regular updates on important matters
  5. No risk in terms of forgery or theft
  6. Reduced cost of trading with the removal of stamp duty charges

Open your demat account today!

Opening a demat account is the first step in investing in the stock market. Choose your stockbroker wisely and they will guide you with the step-by-step processes to start investing. They will also provide an expert advisor who will help you hedge losses and make profits during your trading journey.

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