Why you should you have a Demat account with your bank account?

by Arjun Pal Student

One of the biggest benefits that you get from the Demat accounts is easy accessibility. All you need is a device that has an internet connection such as smartphones, laptops, and tablets. It becomes extremely easy to keep track of your investments when you have such an account.

It becomes easy to rematerialize and dematerialize your securities

When you have such an account it becomes very easy to dematerialize and rematerialize your securities. All you have to do is instruct your DP (depository participant) to do the same. The term dematerialize in this context means converting to electronic form from a paper document. On the other hand, the word rematerialize means converting to a paper document from the electronic form.

It is a lot safer

This is also a major reason why you should have a Demat account online in India. Since here your share certificates are maintained in an electronic format there is no chance that they would be subjected to any potential damage such as loss or theft. Such risks can be easily mitigated with such an account.

It becomes easier to open a trading account

If you want to operate in the stock market you would need a trading account because that would be useful for purposes of buying and selling shares. This is why these accounts are just as important as the Demat accounts. When you are trading in the stock market by using your trading account you must provide your Demat number as well.

It becomes easier to execute various transactions

When you have Demat accounts you do not need to visit the physical offices of companies to buy their shares or sell them. All you need to do is click a few times with the mouse or touch a few buttons on your smartphone, and your work would be done. Let us say that you have sold your shares. In that case, the sale would be reflected in your Demat accounts within a space of a couple of days.

Opening a Demat account can help you save on stamp duty as well. SEBI (Securities and Exchange Board of India) has mandated that if securities are in an electronic format you would not have to pay any stamp duty for transferring them. It is always better to open these accounts with a reliable service provider such as ICICI Direct as that way you would not have to worry about anything at all.