Free Demat account in India was earlier quite tough to get access on, but with time, this facility has also been provided by various institutions for free. Firstly what is a demat account and what are its features?
By putting it simply, Demat account is like a screwdriver, and without it, you can’t open a nut. Just like that this account is important before you plan on to invest in stock markets. Additionally, it is extremely difficult to buy or sell securities in physical form than through an online form.
The number of agents which are dealing in physical shares, as well as the number of buyers willing to purchase physical shares, is much less as compared to the individuals transacting in dematerialized securities.
Coming to your next question, which is how can you open this account?
Opening a demat account is not a hard thing to do. Compare broker in India and find the best one. As they require minimal documentation. For instance, consider the stock brokerage firm perfect, when –
• The firm is providing better services.
• They have better and affordable charges.
• Lastly, if they have low brokerage charges, which works like cherry on top.
This will help you to shortlist the best stock brokerage firm for you. And, you can easily open your Demat account and avail the benefits it brings with it.
Brokerage comparison is also necessary to find the best stock brokerage firm with all the possible needs.
Below is the list of certain features of Demat account, which will provide you with a better understanding of its working.-
Easy share transfers:
The major entitlement of having a demat account is that the investors can transfer their holdings through a delivery instruction slip generally known as DIS, or receipt instruction slip (RIS) for buying or selling shares. These slips allow the users to provide all the details that are required for executing a transaction smoothly and also efficiently.
Faster dematerialization & rematerialization of the securities:
The Demat account holders have the benefit that they can provide instructions to their depository participant (DP) to convert physical certificates into electronic form. Accordingly, they can also ask them for the electronic securities to be reconverted to physical form, if required.
Freezing Demat accounts:
Demat account holders have the benefit to freeze their accounts for a certain period, if required. This option can be very beneficial to those people who wants to prevent unexpected debit or credit into one’s Demat account. The freezing option is also available for a specific quantity of securities held in the account which is again, add on feature.
Corporate benefits & actions:
If the companies avails benefits in general, then they offer dividends, refunds, or interest to their investors, these benefits are automatically available or transferred to the Demat account holders account. In addition, the corporate actions like the bonus issues, right shares, or stock split are automatically updated in the Demat account of all the shareholders, so that you don’t need to worry.