1.What is a Depository? 
A depository is an organization which holds securities of investors in electronic form at the request of the investors through a registered depository participant.  

2.What is the minimum net worth required for a depository? 
Rs.100 crores. 

3.How many Depositories are registered with SEBI? 
At present two Depositories viz. National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) 
4.Who is a Depository Participant (DP)? 
A DP is an agent of the depository who provides depository services. 

5.Who can be a DP? 
Public financial institutions, scheduled commercial banks, foreign banks with the approval of the Reserve Bank of India, state financial corporations, custodians, stock-brokers, clearing corporations / clearing houses, NBFCs and registrar to an issue or share transfer agent   complying with the requirements prescribed by SEBI can be registered as DP. 

6.Who is an Issuer? 
"Issuer" means any entity issuing securities which can be held by depository in electronic form. 

7.What is an ISIN? 
ISIN (International Securities Identification Number) is a unique 12-digit alpha numeric identification number allotted for a security (e.g.- INE383C01018). 

8.What is dematerialization (demat)? 
Dematerialization is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form. 

9.What is Rematerialization (remat)? 
Rematerialization is the process of converting securities held in electronic form in a demat account back in physical certificate form. 
10.Who is an Registrar and Transfer Agent (RTA)? 
An RTA is an agent of the issuer. RTA acts as an intermediary between the issuer and depository. 

11.Who is registered owner of Securities? 
Securities held in physical form by an investor, his/ her name is recorded in the books of the company as a 'Registered Owner' When physical shares are converted into electronic form, the depository becomes 'Registered owner". 

12.Who is a Beneficial Owner (BO)? 
All the benefits of the dematerialized shares are given to the actual investor; hence, the actual investor is the "Beneficial Owner" (BO) of the securities. 
13.Is it compulsory for every investor to open a BO account to trade in the capital market? 
It is advisable to have a beneficial owner (BO) account for trading at the exchanges. 

14.How I can avail the services of a Depository? 
To avail the services offered by the depository, the investor has to open an BO account with a Depository Participant (DP). 

15.What are the services provided by a Depository? 
∙Opening a demat account; 
∙Maintaining record of securities in the electronic form; 
∙Settlement of trades by delivery or receipt of securities; 
∙Settlement of off-market transactions between BOs; 
∙Receiving electronic credit in IPO; 
∙Receiving non cash and non-cash corporate benefits, 
∙Pledging of securities to avail loans against shares, 
∙Freezing of the demat account for debits, credits, or both 
16.What are the benefits of availing depository services? 
∙A safe and convenient to hold securities, 
∙Immediate transfer of securities, 
∙Elimination of risks associated with physical certificates. 
∙Reduction in paperwork, 
∙Reduction in transaction cost, 
∙No odd lot problem, 
∙Nomination facility, 
∙Change in address recorded with DP gets registered with all companies in which investor holds securities electronically 
∙Transmission of securities  
∙Automatic credit into demat account due to corporate action 
∙Investments in equity and debt instruments in a single account. 
17.How can one open an account? 
 First an investor has to approach a DP and fill up an account opening form. The account opening form must be supported by copies of any one of the approved documents which serve as proof of identity and proof of address as specified by SEBI. Apart from these PAN card has to be shown in original at the time of account opening from April 01, 2006. All applicants should carry original documents for verification by an authorized official of the DP, under his signature. 
18.Can a demat account be opened directly with depository? 
 No. A demat account cannot be opened directly with depository. It has to 
be opened only through a Depository Participant of depository. 
19.Can a demat account be opened in the name of joint holder? 
Yes. A demat account can be opened in a single name or in joint holders' name. There can be maximum three account holders 

20.Can a demat account be opened in the name of trust? 
Yes. A demat account can be opened in the name of a trust if the trust is registered under the Public Trust Act. If the trust is a private or unregistered trust then a demat account shall be opened in the name of trustees as an individual account. 

21.Can a demat account be opened in the name of HUF? 
Yes. The Demat account shall be opened in the name of HUF entity as the name of entity appears on the PAN Card. The PAN details of the both the HUF entity and Karta of HUF shall be submitted to the Depository Participant (DP). 

22.Does an Non Resident Indian (NRI) need any Reserve Bank of India (RBI) permission to open a demat account? 
No permission is required from RBI to open a demat account. However, credits and debits from demat account may require general or specific permissions from designated authorized dealers. 

23.Is nomination compulsory for a demat account? 
SEBI has mandated that nomination should be recorded for a demat account held by individuals. If nomination is not to be given then the account holder(s) should give a written and signed declaration for no nomination. 

24.Can multiple accounts be opened by an investor? 
Yes. An investor can open more than one account in the same name with the same DP and also with different DPs. Investor has to strictly comply with know your client (KYC) and also provide PAN number. 

25.Can an investor open a single account for securities owned in different ownership patterns such as securities owned individually and securities owned jointly with others? 
No. Demat account must be opened in the same ownership pattern in which the securities are held in the physical form.  
26.What is required to be done if one has physical certificates with the same combination of names, but the sequence of names is different i.e. some certificates with 'A' as first holder and 'B' as second holder and other set of certificates with 'B' as first holder and 'A' as the second holder? 
In this case the investor may open only one account with 'A' & 'B' and lodge the certificates with different order of names (B & A) for dematerialisation in the same account. Provided Transposition cum Demat form alongwith DRF and share certificate(s) are required to demat the shares. 
27.What are all charges an investor has to pay for opening and maintenance of a BO account? 
SEBI has rationalized the cost structure for dematerialisation by removing account opening charges, transaction charges (for credit or buy transactions of securities), custody charges and account closing charges. Custody charges are now paid by the issuer companies. Broadly, investors are required to pay the charges towards," 
-Demat and Remat of their securities 
-Annual account maintenance charges 
-Transactions fees (only for sell transactions) 
-Pledge / Margin Pledge / NDU transactions  
The DP may revise the charges by giving 30 days’ notice in advance. Further, SEBI has also advised the DP s to submit to their Depository their tariff/charge structure every year latest by 30th April and changes made therein, along with the date of effect to enable the investors to have a comparative Analysis of the tariff/charge structure of various DP's. The information received 
by the depositories is put up on their websites. 

28.Is Account Maintenance Charges (AMC) collected upfront by the DP s to be refunded in the event of closure of BO account? 
Yes. In the event of closing of demat account or shifting of demat account from one DP to another, the AMC collected upfront on annual / half yearly basis by the DP, shall be refunded by the DP to the BO for the balance of the quarter/s.  
29.Whether all DP s are required to refund the AMC collected upfront for the balance quarters? 
No. It will not be applicable to the DP s who collect quarterly / monthly AMC. 

30.How will the beginning of year be considered for the calculation of the AMC? 
For the calculation of the AMC, year shall begin from the date of opening of the account in quarterly rests. 

31.What would be the charges for account closure and securities transfer due to account closing? 
No charges shall be levied by a depository on DP and consequently, by a DP on a BO, when source and target BO accounts are identical in name and patterns. However, not fulfilling   the stated criteria, would be treated like any other transaction and charged as per the schedule of charges agreed upon between the BO and  DP. 
32.What should be done if the address of the investor changes? 
Investor should immediately inform his DP along with necessary documents, who in turn will update the records. This avoids the need of informing different companies. 

33.Does the investor have to keep any minimum balance of securities in his account? 

34.Is it necessary to have account with the same DP as broker has? 
No. Investor can choose any DP as per his / her convenience or choice and carry-on trading activity through broker of his / her choice, irrespective of the DP of broker. 
35.Can an investor operate a joint account on either or survivor basis just like a bank account? 
ii.‘Anyone of the holders or survivor(s)’  
The abovementioned modes of operation may be used only for the following transactions;  
a.Transfer of securities including Inter-Depository transfer. 
b.All pledge related transactions  
c.Freeze/unfreeze account, ISIN and specific number of securities. 
 However, for all other transactions at joint account level, the mode of operation shall be as mentioned at point (i) above. 
36.Can someone else operate the account on behalf of the BO on the basis of a power of attorney (POA)? 
Yes. If the BO authorizes any person to operate the account by executing a POA and submit it to the DP. 

37.How can intimation of any transaction be given for POA operated accounts? 
Subscription of SMS alerts, accounts operated through POA is mandatory except in cases of non-individual accounts, foreign individuals & NRIs. 

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