How to Open a Demat Account in Stock Market

In India Demat( Dematerialized) Account is necessary for Holding and Trading of Shares.

It’s simply an Account that manages our portfolios( portfolio means- How Many Securities we have in our Demat Account or simply we can say “Bai-Khata” in Hindi). In a Demat account we don’t need any physical certificates of shares. In this Article we will see how to choose a broker to open a Demat Account and step by step process associated with this.

Types of Demat Account in India

First we have to understand the types of different Demat accounts on the need of different investors.

1. Regular Demat Account:-

 Regular Demat Account is for the Residents of India. If You want to trade in the Indian Stock Market or invest in Equities,Mutual Fund,Bonds and other securities you need a Regular Demat Account.

2. Repatriable Demat Account:-

This account is for NRIs  who want to invest or trade in the Indian stock market.Repatriable Demat Account allows investors to transfer funds abroad but the account must be linked to Non Resident External (NRE) A/c. NRE account is an account that earns income outside of india.

3. Non Repatriable Demat Account:-

This account is also used for NRIs but with some limitations. A Non Repatriable account does not allow the transfer of funds abroad and this account must be linked to a Non Resident Ordinary(NRO) bank Account. NRO account is a bank account in rupees that allows NRIs to Manage their income earned in India.

4. Basic Service Demat Account

This Account is used for small investors. Basic service Demat Account helps investors reduce maintenance cost.if your holdings below 50000 Rs. No AMC is charged and nominal fees will be charged if your holding between 50k to 2 lakh Rs.

Key Points to Remember before Opening a Demat Account

1. Broking Charge

Every Transaction in our demat account comes with some brokerage charges. Full service brokers charge higher fees because they provide research and advisory services while discount brokers charge low brokerage but offer limited additional services.

2. Annual Maintenance Charges  

All Demat accounts come with some AMC Fees but some banks and financial institutions waive off AMc charges while some charge AMC.

3. Service Offers

Always Choose brokers that align your trading style. If you are a trader and investors your demat account provider must have Advanced tools and Real Time Data.

4. Trading Platform

Choose a faster trading platform that is easy to use and supports quick execution of orders.This is a must if you are a trader.

Documents Required to Open a Demat Accounts

To Open a Demat Account in India you have to submit some documents. Like

1. Pan Card:- PAN card  is Mandatory
2. Proof of Identity:- Any Govt. issued IDs Like Aadhaar,Passport or Voter ID.
3. Proof Of Address:- Bank Statements,Aadhaar or Passport.
4. Bank Details:- A canceled cheque or bank statements is required to link a bank account.
5. Income Proof:- Sometimes it is required if you trade in derivatives.

Step By Step Process to Open a Demat Account

1. Choose a Depository Participants(DP)

A Depository Participant is an agent of the Depository (either NSDL or CDSL) that offers Demat Accounts service to Investors/Traders like Zerodha, Angle One,ICICI direct,HDFC securities etc.

2. Fill the Application Form

After choosing DP, go to the official websites, fill out the Application form and submit.

If you are facing some problem, talk to customer care. If you want to go for an offline process then you have to go to the nearest branch of choosing a Depository Participant.

3. In Person Verification(IPV)

 According to SEBI( Securities and Exchange Board of India) every Applicant needs to complete the IPV process. Some DP take Video Based verification they can ask your original documents on camera for verification.

4.  E-Sign the Documents

After your KYC is verified, You may need to e-sign the Account opening form like aadhaar based OTP verification.

5.  Receive Your Demat Account Details

 Once All Documents are submitted you will have Demat Account ID and Password.You can change your password and Start your Investment Journey.

Popular Platform to Open Demat Accounts in India 

1. Zerodha:- Zerodha is India’s Leading Discount Brokerage firm.It has low brokerage and a user friendly platform and educational material for new investors. 
2. UPStox:- Another Popular Discount Broker UPStox Provider a simple accounts opening price.
3. Angle One:- Angle one is a full service brokerage firm provides Research Reports and personalized Recommendation.
4. ICICI Direct:- It is also a Full service brokerage firm that provides extensive market research and advisory services.
5. HDFC securities:- It is also a Full service brokerage firm that provides extensive market research and advisory services.

Conclusions

Opening a Demat Account in India is a very simple process.We have a variety of options available according to our need, So Choose Right Depository Participant whether you are a long term investor or an Active Trader and Start your wonderful Journey in Stock Market. 

Happy Trading !!!