Benefits Of Demat Account Opening
Just like a savings account offers security and easy access to our funds, a Demat account does the same for investors. A Demat account is an essential requirement for investment in the stock market.
What is a Demat Account?
A Demat account is used to hold your shares and securities in a digital format. It stands for a dematerialized account. Dematerialized shares are the ones that have been bought and converted from physical to electronic format. During online trading, shares can be bought and held in a Demat account. It can hold a user’s investments in shares, government securities, exchange-traded funds, bonds, and mutual funds, all in one place. Demat thus makes online trading easy for users.
Demat allowed the digitization of the Indian stock market and ensured better governance by the Securities and Exchange Board of India (SEBI). The Demat account also improved safety by storing securities in electronic format. This reduced the risks associated with damage, theft, and malpractice. It was first introduced in 1996 by the National Stock Exchange (NSE). Back in the day, the account opening process was manual and it took many days to get the account activated. Now, anyone can open an online Demat account in 5 minutes.
How to open a Demat account?
Indian share depositories like The National Securities Depository Ltd (NSDL) and the Central Depository Services India Ltd (CDSL) provide free Demat account services. Stockbrokers like ANSPL can help you avail of these services and open a Demat account. Every intermediary may have account charges that vary with the volume in the account, subscription type, and terms and conditions of the depository and stockbroker.
What are the benefits of Demat account opening?
A Demat account is a prerequisite for Indian stock market trading or investing. Here are the benefits of opening a Demat account:
- A Demat account holds shares and securities in an efficient digital format, which completely eliminates paperwork.
- A Demat account is convenient and allows easy access to all your shares and securities.
- It securely stores your shares. So there is no risk of theft, damage, or losing the share certificate, which occurred with physical shareholding.
- It helps in the quick transfer of shares from one account to another.
- It provides nomination facilities and convenient transmission in case of the death of the user.
- With a Demat account, there’s no stamp duty on the transfer of securities. This lowers the cost of trading and investing in the Indian stock market.
- It helps settle or disburse corporate benefits like dividends, interest, and refunds.
- It eliminates the chances of bad deliveries and mismatches between your address and your bank account.
- TDS is not deducted for Demat securities.
- The Demat account information and statement are regularly sent to you, so you can easily monitor and transact by just logging in.
Open a Demat Account
If you wish to open a Demat account, ANSPL is here to help you with it. ANSPL is one of the most reputed and trusted stock broking firms in India. Contact us and open your Demat account today.
