For any kind of investment and trading in equity markets, it is mandatory to have a demat account. Demat account works on the same principle of your regular saving bank account where your money parks. Same in the case of your demat account, after any buying selling your shares remain parked in your demat account.
Biggest benefit of having a demat account is your shares remain safe in digital format however you can easily transfer these shares to other demat account or you can sell them whenever you want. Of course there are some minimal charges by your broker for the same.
Many times clients are not aware of these charges so it is very important for any person to get full awareness about these charges. Moreover you can also request to waive some parts of these charges from your broker.Today we are going highlight the features of the demat account and what types of broking charges in various market segments charged by the stock broking companies in India.
What is a Demat Account in Simple Words?
Demat is the short form of Dematerialisation, which means the share certificate, debentures, bonds and other investable securities are converted from physical form to digital format. The shares or any other security you buy will be visible in your demat account virtually. All the details like quantity, name of the shares or other securities with their market value are shown in this demat account with various other unlimited features you need to know.
Why Demat Account is Important?
Not only do equity shares, have a demat account you also have to hold various types of financial instruments like, equity shares, bonds, government securities, bonds, mutual funds and ETFs. It is like your bank account showing your invested securities details. So after every trading activity whether it is purchase of sell, your account will be credited or debited respectively.
As mentioned earlier also you can transfer your shares in hassle free environment from your account to another person and it will not take more than 5 minutes. It has not only eliminated the paperwork but also keeps your invested financial instruments in the safe hands at your depositories.
Currently, in India, the demat account is opened and maintained by only two depositories Central Depository Services Limited (CDSL) and National Securities Depository Limited (NSDL). Both these are central government-formed entities, also regulated by SEBI and all the registered brokers are the members of both either any of them to open demat accounts.
Features & Benefits of Demat Account
You cannot apply or open the demat account directly to NSDL or CDSL, instead you have to choose the best discount brokers in India, who are registered with SEBI and also members of these depositaries. All the brokers provide the facility to open the demat account with various features. Here you should know the features of the demat account.
Features of the Demat Account
However, the features of the demat account are almost the same for you, either you have opened the same with NSDL or CDSL. However from broker to broker you might find little differences, depending on the additional facilities offered by them for their customers. However, still, you still need to know the features and the benefits of the demat account.
Dematerialization: The most important feature of the demat account is that you can hold your equity shares and other investable financial instruments in the dematerialized form. If you have the physical share certificates you can convert them into the demat form.
Ease of Accessibility: You can access your demat account quickly from various platforms. With internet accessibility to various devices like computers or smartphones, you can also access your demat account through a broker's online trading platforms.
Easy Transfer of Shares: Any user can easily transfer shares from one demat account to another through Delivery Instruction slip (DIS).
Use for Pledging against Loan: Using your demat account shareholdings you can borrow loans from the financial institutions. Just like your tangible assets which can be pledged easily, shares in your demat account can be used as collateral security for pledging purpose.
Option to Freeze the Demat Account: if there is any unauthorized transaction or activity in your demat account you can temporally pause or freeze your account for some define period. The freezing of a demat account will stop the debit or credit activity with a specific quantity of securities held.
E-facility of Transaction: When you have a demat account, instead of physically submitting the slip to the DP, you get all the updates of debit or credit and other transactions in your demat account sent electronically by the depositaries (NSDL & CDSL).
Benefits of Corporate Actions: When listed companies offer dividends, bonus shares, share splits, refunds and interest or any other corporate actions regarding the equity shareholders, then you will be automatically reflected into your demat account.
Benefits of the Demat Account
Nomination Facility: A demat account provides you the facility to assign a nominee for your holdings. You can provide the details of the nominee to your depository and in case of the non-existence of the original owner, it can be easily transferred to the nominee.
No paperwork Required: Having the demat account, you don't need to hold or deal with any kind of paperwork. Except at the time of opening your account, you need to submit copies of your identity and address proof, else you don't need any kind of paperwork while using your demat account or doing any kind of transactions like buying or selling of shares.
No Risk of Theft or Other Damages: As the demat account shows the details of all your financial instruments or invested securities in digital format, it is protected from various types of risk like theft, damage from tampering, loss or forgery.
Easy to Monitor the Holdings: As the demat account, hold the invested securities in the digital format, hence, it provides the ease of accessibility to keep the track record of all the transactions of monitor your holdings digitally through your brokers.
Ease of Holding Odd Lots: In the physical certificate, there is a problem while holding or having the equity shares into the odd numbers. While having the demat account you will have the benefit of holding equity shares or other securities into any odd numbers of lots.
Less Time for Settlements: As every transaction or procedure takes place electronically, the time of settlement of each transaction is done at a very fast speed. When you buy or sell shares, it can be easily settled from one demat account to another by exchange.
Low Cost of Handling: Holding the share certificates or other similar documents in physical format is costlier due to stamp duty, handling fees and various other charges. But with a demat account, you just need to pay nominal annual charges, which is much cheaper.
Types of Demat Account
Usually, there are three types of demat accounts that are offered by the depository participants. Though they all have similar features and benefits but are meant for different types of investors. So, let's find out what are the different types of demat accounts.
Regular Demat Account: It is most common and generally used demat account which can be opened through any broker. Basically it is only for Indian residents or in simple words for retail category only.
Repatriable Demat Account: This kind of demats account opened only by NRI only who wants to invest in Indian stock market. For this type of account an NRe bank account should be attached and it can be opened from anywhere in the world.
Non-repatriable Demat Account: Just like a repatriable demat account,this account is also meant for the NRIs, but it doesn't allow the transfer of funds abroad, as you need to link this account with your Non-resident Ordinary bank account to manage the funds.
Demat Account Charges
Opening the demat account you need to pay certain charges. Though many broking house and discount brokers in India offer the demat account freely, still there are certain charges that can be levied or you might be asked to pay for interrupted access and use of the demat account. Let, 's find out the types of charges levied on the demat account.
The custodian or Depository Fees: These are the one-time charges you have to pay the custodians (NSDL or CDSL) within whom you have opened your demat account. Though you don't need to pay directly, your broker will charge you and pay directly to these depositories.
Annual Maintenance Charges: Brokers usually charge these charges one time charges per year to maintain your account. In simple words a kind of annual fees for your account in depositories. Usually every broker charged more or less the same amount but now days some brokers started to waive these charges permanently or for some starting years.
Demat and Remat Charges: This is charges may vary depending on the total value of all holdings and the quantity of transactions you have done while using the demat account. Moreover, such charges might also include digitisation or physical print costs of securities, credit charges, applicable taxes and CESS, rejected instruction charges etc.
How to Open a Demat Account?
To open a demat account in India you need to approach to the SEBI registered broking house or discount brokers like Moneysukh and certain government-certified documents. You can apply here to open the demat account with the following documents.
- PAN Card
- Aadhar Card
- Passport Size Photographs
- Signature on the White Paper
- Proof of Income (Mandatory to trade in F&O)
Tips to Choose & Open the Demat Account
While opening the demat account with Moneysukh or with any other broker, you need to keep various things in mind to get the lowest brokerage charges demat account with maximum features and benefits. Hence we brought here some tips to follow.
Account Opening Procedure: Nowadays, most of the broking houses, and discount brokers are using the online account opening procedure. Hence, you need to ask about the demat account opening procedure, as still many brokers follow the physical verification and documentation procedure to open the demat account which might be time time-consuming process.
Check all Types of Charges: Asking about the various types of charges levied on the demat account users. You should make it clear or ask your broker about the charges you have to pay while opening and using the demat account. Make sure to choose the lowest brokerage charges demat account with all the facilities and trading account facilities.
Linking Facility with Trading Account: While opening the demat account with your broker also ask the linking or connecting your demat account with a trading account. As when you buy and sell shares it should be automatically reflected into your demat account. Hence, it is always recommended to open the demat account where you have the trading account.
Accessibility Check the Demat Holdings: Though, there are no restrictions to access or check the holdings of your demat account, still make sure if there is such limits are imposed while using your demat account. Also, ask if your broker is providing an additional feature like showing the demat holdings with customized analytics.
Choose the Lowest Brokerage Charges Demat Account
Whatever the features or benefits offered by the brokers for demat accounts, almost all of them give similar features. Here you need to check the brokerage charges or annual fees for using the demat account with your broker. Many brokers allow free trading and demat accounts but there should be a minimum value of transactions every year.
While some of the brokers charge one-time fees for demat or trading accounts and some of them charge annually as per your usages. Hence, here you need a low brokerage demat account to minimize your cost of trading or buying and selling the shares in the stock market. Hence, you need to choose the lowest brokerage charges demat account with the best features.
Moneysukh - Lowest Share Brokerage Fees
You can choose the Moneysukh that offers the best trading and demat account withthe lowest brokerage charges in Indiato make your trading experience not only affordable but also very enjoyable. Here you can trade almost negligible charges with the option to choose the various plans that suit your trading style and investing criteria to give flexibility to pay.
Here you don't need to pay any account opening charges, first-year maintenance charges are free and you don't need to pay any charges for using the research tools and there will be zero charges for delivery if you choose Plan A. There are various options to choose the best plan according to your frequency and volume of trading to trade at the lowest brokerage.
Lowest Intraday Brokerage Charges in India
Having a demat account and trading with Moneysukh, you will pay the lowest intraday brokerage charges in India. Moneysukh offers various plans given below.
Plan A: Under this Plan, you don’t need to pay any brokerage charges for delivery in equity, as there is there is zero brokerage for equity share delivery. For intraday trading in equity, you need to pay only 2.5% or Rs. 20/executed order whichever is lower.
PlanB: Under this Plan for equity delivery you have to pay only 2.5 % or Rs. 10 per executed order whichever is lower. While for intraday trading in equity, you will be charged merely 2.5% or Rs. 10 per executed order whichever is lower.
Lowest Brokerage Charges for F&O
Plan A: Under Plan A for trading in the equity future, Moneysukh is charging 2.5% or Rs. 20 per executed order whichever is lower, while for trading in the equity options you have to pay flat Rs.20 per executed order and other government-levied taxes and fees.
Plan B: Plan B is cheaper compared to Plan A, as under Plan B, for equity future you have to pay 2.5% or Rs. 10 per executed order whichever is lower and for transacting in equity options you just need to pay the flat Rs. 10 per executed orderwith other nominal taxes.
Note: In all types of plans you have to pay additional charges like STT, Exchange Transaction charges, GST, SEBI Charges and Stamp Charges or penalties applicable as per the government rules. For more details about the Moneysukh broking charges and trading fees, you can visit at Pricing Plan.
You can choose any broker offering the lowest brokerage charges demat account in India, but keep in mind, that only less brokerage demat account in India would be not enough you also need to check various other aspects while choosing the best discount brokers in India.
Apart from a low brokerage demat account you also need the best trading platform where you can trade or invest seamlessly from various devices. One of the advantages of the best online trading platforms in India is that you can access your trading account from different cross-platforms to execute your trade or can check your investment in various financial instruments.
Moneysukh offers a one-stop trading and investing solution with the lowest brokerage charges in India. Here you can trade or invest in equities, commodities and currency markets at the lowest brokerage charges for all the segments in delivery, intraday or future &options.
Here you will get the best trading applications and algorithms such as Trade Radar, TradeTron, Quantman, AlgoBulls, FoxTrader and Keev, all are integrated with the TradingView charting system with updated live feeds of market data to give you an uninterrupted trading experience.
Apart from that having the trading and demat account with Moneysukh, you will also get the advantages of trading in high-frequency trading through Algo-trading software. It offers the best Algo trading platform with the best intraday Algo trading strategy to choose the most popular & profitable Algo trading strategies with best algorithm as per your trading style and risk-bearing capability to earn extra money from high-frequency trading.
Not only have the lowest charges demat account with Moneysukh, but you will also get free access to research reports and regular tips and recommendations to buy and sell in the stocks, commodities and forex market that is by the market experts to make your trading journey highly profitable with useful learning articles on financial related various topics.
Hence, while choosing the lowest brokerage charges demat account make sure to also check what types of other facilities and benefits are offered by the discount brokers or the broking houses. And while trading or investing also keep in mind there are various factors that affect the stock market in India and there are also various risks involved while investing in the stocks.