Want to Open a Demat Account? Here’s All You Need to Know

If you would like to invest in equities, you will have to hold shares in an electronic form. So, it’s essential that you open a dematerialised or demat account before investing in stocks.

This type of account not only holds shares (investments in equity), but also fixed deposits, corporate bonds, government securities, etc. A demat account is an electronic account opened with a registered Depository Participant (DP).

Here, you can convert your physical shares into electronic form for future access. The demat makes it easier for investors as there is no paperwork required.

So, the time required for executing a transaction is significantly reduced. After being introduced in 1996 in India, it has proved to be a boon and has increased the convenience of handling securities.

Opening a Demat Account

The procedure to open a demat account is pretty quick and simple. Here are the few easy steps to open a demat account online-

  • You can open a demat account online with the help of your Aadhar number.
  • Select the broker, fill in your basic details and set a unique password to continue with the application.
  • Enter your PAN card details for verification and pay the required charges for opening the account via net-banking.
  • Fill in the details required and upload your financial documents along with a cancelled cheque, income proof, bank statement, signature copy and PAN card copy.
  • Enter the OTP that you received on the Aadhar card website and wait for a week or two for the welcome kit to arrive.

With Axis Direct, this process gets even simpler and you can open a demat account online in just 15 minutes by following this process:

1. Start your online demat account opening journey.

2. Provide your name, phone number and a verified email address.

3. An OTP will be sent to your entered mobile number to verify and continue the process.

4. Enter the PAN card number and date of birth to complete the next step.

5. The next step will require you to fill up the personal details like:

    • Name
    • Permanent address
    • Residential status
    • Marital status
    • Highest education
    • Father’s and mother’s basic information
    • Financial information & information on income
    • Trading experience

6. Fill up bank details:

    • Bank name
    • Bank account number
    • IFSC code

7. Make payment (many payment modes are available)

8. Upload your documents

    • Cancelled cheque
    • Passport size photo
    • Address proof – Aadhar card/driving licence/voter ID/passport

9. E-sign your online demat account opening form.

10. You’re done! Start trading and avail great benefits like low brokerage and enjoy unlimited trading at just INR 20 per order.

When you open a demat account, you will be asked to pay a small fee that will cover your transaction charges, pledge charges, failed instruction charges, annual maintenance charges and so on.

Before you open an account, check the customer support system, broker reliability and credentials, reliability of the trading platforms, research and analytics. This will help you learn more about the company and its brand value.

Benefits of a Demat Account

  • Investments held in electronic form are prone to minimal risks such as thefts, losses and damages.
  • It is very convenient as you can access your account from anywhere and at any time.
  • A single demat account can hold both equity and debt investments.
  • Customers won’t be required to pay stamp duty charges while transferring physical certificates.
  • Liquidity is facilitated as you can sell the securities at any point of time, during trading hours.
  • Corporate actions like dividends, interests, refunds and bonuses are automatically reflected in your account.
  • Since there is no involvement of paper, the transaction process is much quicker.
  • You can buy and sell any number of securities as there are no limits on the number of transactions.

A demat account just acts like a savings account in operation. Like savings account holds your money in electronic format, a demat account holds your investments in securities in electronic format. Demat accounts have made it quick, easy, safe and convenient for customers to invest. So go ahead and open demat account today!

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About FinanceGAB

Ajeet Sharma is a financial blogger and I am blogging since 2017. Financegab is a personal blog dedicated to personal finance. The main aim of this blog to help people to make well-informed financial decisions.
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