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How to Convert Physical Shares Into Demat: Stepwise Procedure

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If you have any listed company’s shares in physical format, you should convert them right now as soon as possible, because SEBI has extended the deadlines many times and now no such extensions will be granted any more for such shareholders.

Hence, you should also convert them into dematerialized from, so that you can sell them into secondary and monetize the value of the investment. However, in the demat account, you can keep the shares or other invested financial instruments for an unlimited period. And there are various features and benefits of having a demat account.

Also Read: Features of Best Demat Account with Lowest Brokerage Charges in India

Why Demat Account is Necessary?

The apex regulatory body, SEBI has made it mandatory to convert all the shares into the demat form, which means it is necessary to convert all types of physical shares into digital or electronic form. However, there multiple benefits of having and using the demat account.

Safety of Assets: One of the best advantages of having a demat account or keeping your shares in the dematerialized form is that your shares will remain safe from misplacing, getting lost, forgery and any kind of temperament or physical damage, as it is in the electronic form.

Convenience of Use: Dealing with a demat account is highly convenient in terms of unlimited access, use or storage of asset details. Moreover, you can access your demat account from anywhere through various devices giving you the convenience of use at nominal charges.

Ease of Access: You can access your demat account from web pages, mobile applications and various other devices having internet connectivity and equipped to open the online portals. You can access your demat account from the same credentials through cross-platform devices.

The Flexibility of Use: Except for a few specific conditions, thereare no such restrictions on using your demat account you can access it from anywhere any time and many times without any limits. Moreover, you can buy and sell the shares unlimited times and there could be any number of transactions of debit and credit of shares into your demat account.

Low Cost of Maintenance: Keeping your shares that are also considered an asset in physical form you need a safe place like a locker or cabinet to protect from environmental effects. That would be only costlier but you also need regular maintenance of such places. While in a demat account, you don't need to worry about such things, just pay some maintenance charges, your demat account will be maintained by the custodian and depositories electrically at affordable cost.

Is it Possible to Convert Physical Shares into Demat?

Yes, if you have the physical shares in undamaged form, means the original share certificates are in good condition, the text and other details are readable with the document or in good condition you can convert your physical shares into the demat form. As Per the SEBI guidelines, the conversion process must be completed within 21 days, however, many companies take longer time.

Apart from that you must have a demat account, after the conversion of shares from physical to demat it will be transferred electronically by the registrar of the company. Hence, first of all, open a trading and demat account with a broking company like Moneysukh, complete your KYC verify your demat account to be ready for use, and then apply for conversion.

Physical Shares to Demat Deadline

Though SEBI has extended many times the deadline for converting the physical shares into the demat few people are taking this seriously and are not interested in converting their physical shares into dematerialized form. Hence, SEBI has further extended the deadline and there is no guarantee when it would be the last date. So, you should do it right now to avoid heavy charges or banned.

Charges for Converting Physical Shares to Demat

The charges for converting physical shares to demat may differ from broker to broker. However, as per the SEBI guidelines you might be asked to payRs 150 to Rs 400 per share certificate, Rs 100 to Rs 200 courier charges, + 18% GST to convert your shares into the demat format. However, most of the broking companies usually charge in the range of Rs 200 to Rs 850.

How to Convert Shares from Physical to Demat?

To convert your physical shares into demat you need a demat account and then go through a procedure of requesting for share dematerialisation. The entire procedure is time-consuming and needs knowledge and effort to complete every step cautiously like opening your demat account, KYC verification and then filling the request from submitting the same etc.

Stepwise Procedure to Convert Physical Shares into Demat:

Step 1: Opening a Demat Account

After conversion of shares into the electronic form you need a demat account in which shares will be transferred. Hence, First of all, open a demat account with a SEBI-registered DP like Moneysukh that will work as depository participants between you and the depositor. While opening the demat account make sure the name in the physical shares certificates and demat is be same

Also Read: How to Open Demat Account: Benefits and Documents Required

Step 2: Filling out the Request Form

Once you have opened a demat account that is verified with your DP and is now ready to use, then you need to fill out a dematerialisation request form. In the request form, you need to fill in various details like the name of the company you hold shares, the number quantity, the owner name and demat account details of the owner of physical shares duly signed with your signature and other documents.

Step 3: Submission of Documents

Once you fill in all the details in the request form, you have to surrender the physical shares along with the request form to your DP. While submitting the request from, physical shares and other documents, make sure to write down the phrase 'Surrendered for Dematerialisation' on each share certificate to make it defacing eligible for the dematerialisation.

Step 4: Registration of Dematerialisation

Once you submit all the documents with your DP, a dematerialisation registration number will be generated by them through an electronic message to the Registrar and Transfer (R&T) agent along with your original share certificates. The R&T agents are responsible and legally designated for maintaining the records of all the shareholders.

Step 5: Validation & Name Change

Now the T&R agent will check the authenticity of the documents you have submitted through your DP. Once they are satisfied, they will validate the same and go further with the process of changing the name with your DP's and registering the records into the register.

Step 6: Registration & Acknowledgement

Now the number of shares eligible for dematerialised will be recorded in the Register of Members’ account. Once this registration process is completed, an acknowledgement is generated from the Register of Members. It will be also informed officially (electronically) and forwarded to your DP saying the requisite changes have been made.

Step 7: Credit of Shares into Demat Account

Finally, once the registration and acknowledgement procedure is completed the number of physical shares you have applied for the dematerialization will be credited into your demat account. Now you can use these shares to sell in the secondary market using your trading account.

Also Read: Trading Account: Types, How to Open and Documents Required

Documents Required for Converting Physical Shares to Demat

While requesting for share dematerialisation, you need various documents to successfully convert the physical shares into demat. Hence, make sure you have the following documents.

  • Proof of identity – (Aadhar Card or PAN Card)
  • Proof of Address – (Aadhar Card or Passport)
  • Bank Passbook or Bank Account Statement
  • Demat Account Details - (Demat Account No)
  • Original Copies of all the Physical Share Certificates

While submitting the physical share certificates make sure they should be in good condition with clearly visible all the printed detailsAnd if you are requesting to convert physical shares to demat of more than one company, you have to submit different forms for different companies. Also, make sure to mention the 'Surrendered for Dematerialisation' on each share certificate to deface all the physical share certificates before submitting them to the DP.

Summing-up

Converting the physical shares in the demat form is not only necessary but also mandatory to make your investment not only safe but also available electronically for selling and buying in the stock market. In a demat account, you can check your shares anytime with their current market value showing through your broking company's online trading platform.

Also Read: What are the Top Factors Affecting the Stock Market in India

In a demat account, you can have multiple companies of shares in unlimited quantities and transfer the shares to anyone as per your wish. Earlier converting the physical shares into electronic form was a little cumbersome and time-consuming process, but now thanks to fast KYC and digitalization of the verification process, you can do it easily within a few weeks. Here you just need to choose the right DP or broking house to open the demat account and help you perform the entire process.

Why Choose Moneysukh to Covert Your Physical Shares into Demat?

As we have already told you, for converting the physical shares into electronic from you need and demat account and reliable DP to help you perform all these procedures. Here you can choose Moneysukh which offers trading and demat accounts with an online facility for trading and investing in equities, commodities and forex trading with the best trading platform.

Also Read: Things to Know Before Starting Forex Trading  & How to Start

Moneysukh is one of the best discount brokers in India offering trading and investing facilities with the most advanced trading software and algorithms like TradeTron,Trade Radar, Quantman, Keev, AlgoBulls and FoxTrader and all are integrated with the TradingView charting system with updated live feeds of market data to give you an uninterrupted trading experience.

Also Read: How to Start Algo Trading in Moneysukh: A Best Algo Trading Platform

Here you will get the advantages of best online trading apps with user-friendly platforms equipped with all the trading tools and market-related information to provide you with the best trading experience. Moneysukh also has a research team to analyse and recommend buying and selling tips with research reports and investment articles that are accessible to clients.

Also Read: Why You Should Invest in the Stock Market: Reasons  & Benefits

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