Check Why You Need To Have A Demat Account and RTA service provider?
Demat Account emerged in the year 1996 as a better and paperless option over the physical share certificate which is paper & time-consuming method of exchange. However, now the legal Demat account has become mandatory for the stock traders as per the Securities and Exchange Board of India (SEBI) laws. Generally, an investor gets its Demat account opened when he gets himself associated with an investment broker or sub-broker.
Demat Account has actualized the dematerialization of shares at the time of need and its presence in electronic mode has simplified, secured, eased, quicken and lowered the cost of the whole process of investing, possessing and trading. Let us take a deeper dive into the features of the Demat Account.
Features
Smooth transfer of Holdings:
The Delivery Instruction Slip (DIS) or Receipt Instruction Slip (RIS) features in the Demat account let investors easily buy and sell their shares. These slips contain all important details which are necessary for hassle-free transactions.
Simple & Easy Securities' Dematerialisation & Rematerialisation:
Physical securities can easily be converted into electronic form and vice-versa with the Demat account.
Account Freezing:
Demat account can be frozen or hold whenever required by the holder. This is generally done when the holder wants to avert the unanticipated credit or debit from his account. However, the quantity present in the investor's debate account can only be freezed and for a certain time-frame.
Numerous Streaming Points:
A debate account holder can operate & access his Demat account with different online modes including smartphones, desktop or any other smart gadget.
Corporate Actions & Advantages:
The Demat account auto-updates the holders for Corporate actions like bonus issues or right shares and makes them eligible for corporate advantages like interests, dividends, and refunds given to their investors by the company.
E-transfer of instruction slips:
National Securities Depository Limited (NSDL) facilitates users to transfer the instruction slips electronically instead of manual processing which consumes less time and increases convenience.
Easy Loans Availability:
Demat account securities can be used as a collateral to avail loans from some specified lender which allow so, by the Demat account holders.
Today’s digital era has knocked off the physical share certificates and today only a few registrars and transfer agents or brokers purchase physical shares. The leading agents of the country like SAG RTA are involved in the transfer of dematerialized securities. Demat Accounts has become an indispensable need at present because of its efficiency, easy holding and many other advantages which are as follows:
Read Also:- Know Everything about Registrar and Transfer Agent and Their Services
Advantages
Convenient Shareholding: Unlike physical certificate, all the investments can be conveniently held & tracked with a single Demat account.
Low Risk: The electronic storage of Demat Account eliminates the risk of damage, loss, theft and fake & bad deliveries.
Low Cost: Demat Accounts have minimized the additional costs like the cost involved in the physical management of shares, handling charges, stamp duty and so on.
Less Time Consuming: Unlike paper transactions which consume lots of time, the transaction like purchase & sale of security holdings with Demat account is fast, safe and efficient.
Quantity Irrespective: Unlike with physical certificates, Demat accounts provides the facility of dealing easily with as much quantity as an investor wants.
Buying and Selling shares through the Demat account
All the transactions at the stock exchange are possible only through the Demat manner. Let us understand the process of buying and selling shares through Demat Account,. Well for buying the shares, we need not have a Demat account because it just acts as a storage of our shares. However, the Trading account here plays an inevitable role, it is an ad hoc for selling and purchasing the shares followed by the deposition of traded shares in the Demat account in T 2 day.
Read Also:- Know The Advantages of Dematerialisation
In an exceptional case, when the investment is made in an IPO (Initial Public Offering), the trading account is not needed and IPO shares get directly deposited in the investor’s account.
Role of RTA Service Provider
The importance of the Demat Account is now clear. The rights i.e. the benefits always arrive with some duties and we all are now duly aware of the numerous benefits of Demat Account, we shall have a glance at the duties which should be executed properly by the investors for proper management of Demat Account. Some of the duties are reconcilement of contract notes, Dematerialisation of shares, Duly receiving holding statements, Dividend revalidation and many more.
Fulfillment of all these responsibilities is undeniably a tiresome and troublesome job which demands huge amount of time, knowledge and skills. For this to happen timely and correctly, services can be availed by the third-party Registrar and Share Transfer Agent SAG RTA. These RTAs act as intermediaries between the investor and the leading centralized depositories like CDSL & NDSL and acts & duly fulfills all the obligations on investors’ behalf. Make sure to avail services from SEBI approved RTA to have glitch-free experience. SAG RTA is SEBI accredited RTA service provider which comes among the top-notch RTAs of India.
