Why Every Indian Must Have A Demat Account

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  • 08 Feb 2023

A savings account is often just your first step towards financial security. If you want to grow your wealth, you’ll need a demat account too.

Related: Reactivating your dormant demat account

A demat account is somewhat like a bank account. It is an online account that holds your share certificates or securities in digital form.

  • Select the DP with whom you will open the demat account.
  • Fill out a demat account opening form.
  • Submit the form to the DP along with a passport-sized photograph and copies of the required documents.
  • Carry all original documents for verification.
  • An in-person verification will take place thereafter.
  • On approval of the application, the DP will send you the client ID and account number. Related: Demat account for minor

What Can A Demat Account Hold?

Demat accounts hold more than just shares. They also store bonds, mutual funds, non-convertible debentures, exchange-traded funds, and gold in the demat form.

Demat accounts are thus suitable for all kinds of investors. Plus, they are convenient and safe.

  • One-stop shop for holding all securities in your portfolio
  • Quick and convenient transactions
  • Accessible from anywhere
  • No stamp duty
  • Direct communications with depository participants (DPs) and companies
  • Reduced paperwork
  • Greater safety than with physical certificates

Related: Features of demat account

What The Future Holds

The government has approved a proposal for creating a national database of academic certificates. Soon, even academic marksheets could be issued in the demat form. So, the usefulness of demat accounts in India is likely to increase.

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