Demat account is very significant for anyone who wants to trade or invest in the Indian stock market. As per the Securities and Exchange Board of India (SEBI) guidelines, demat account is the primary requirement to trade in shares. In this article, you will learn about the top features of the demat account.
Features of Demat Account
- Transfer of Shares
With a demat account, shares can be easily transferred from one account to another. An investor can transfer their holdings using a Delivery Instruction Slip (DIS) or Receipt Instruction Slip (RIS). These slips provide all the details of the user and enable a smooth execution of the transaction.
- Dematerialization and Rematerialization
The demat account holder can convert his physical holding of shares or securities into electronic form by giving the instructions to the depository participant. Similarly, electronic holdings can also be converted into physical form.
- Loan Facility
The securities held in the demat account can be used to avail loan facility from the various lenders. The holdings of the demat account are held as collateral security by the lender.
- Multiple Access
With technological advancements, the demat account can be operated from anywhere across the globe. To access your demat account all you need is an internet connection and computer or smartphone or any other smart device.
- Freezing Facility
To prevent unauthorised transactions in the demat account, you can avail the freezing facility. With this facility, no transaction can take place in the demat account for the period as specified by you. This facility is good for those investors who do not trade regularly and want to save themselves from any unexpected debit or credit into the account.
- Corporate Benefits
One of the main features of the demat account is that its holders can enjoy the various corporate benefits and actions at a single place. The benefits are in the form of dividends, interest or refunds which gets automatically credited to the account. Furthermore, adjustments of various corporate actions like right shares, bonus shares, stock split, etc. are automatically updated to the demat account.
- Speed e-Facility
To simplify the procedure, National Securities Depository Limited (NSDL) has allowed the users to submit the instruction slip electronically rather than submitting it physically.
The above mentioned are a few features of the demat account. If you want to open demat account online, you can contact Kotak Securities. You may also inquire about free demat account services, if any.