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List of documents required for opening a demat account

February 21
10:56 2020

A Demat account is, in a way, like your bank account. If you are opening a Demat account online, you will have to upload your PAN card and address proof by logging on to the DP’s (broker/ bank) website. The documents mandatorily required are mostly common across brokers, banks, and other financial organisations that act as an online trading platform. You will have to ensure that the papers are valid as on submission date and that they haven’t crossed the expiry date.

Personal details: Furnish proof of identity and proof of address in the prescribed format. Most of the brokers/ banks pre-fill them once you provide them with PAN and other documents. Verify and cross-check them.

Bank, income details: You will have to part with your Bank Account Number and IFSC code for opening a Demat account. However, there is no cause for worry as the info is safe with the broker. You will also have to furnish your income details.

Apart from the documents for demat account, you will also have to provide your Depository Participant (DP) two to three photographs of yours.

Documents checklist to open Demat account

A quick checklist of documents required to open a Demat account with a financial organisation, including a broker or a bank, would be:

Proof of Identity (POI): Driving licence, Voter’s ID, UID or Unique Identification Number etc will be accepted as proof of identity

Proof of Address (POA): Passport, Voter’s ID, Aadhaar, ration card etc can be provided as document proof for address to open a Demat account.

Proof of Income: This is required for trading in derivatives such as F&O. Copy of ITR Acknowledgement etc can be furnished.

Proof of Bank Account: Cancelled cheque leaf can be provided for this purpose

PAN Card: A PAN card is mandatory for opening a Demat account with any bank or broker (except those who are specifically exempt from obtaining PAN; as listed in ‘Exemptions/Clarifications’ to PAN section)

Photographs: Keep in handy three copies of passport size photographs while visiting your broker /bank for opening a Demat account.

List of documents required as proof of identity to open Demat account

As proof of identity to open a Demat account, one can submit any of these documents:

  1. PAN card: This is a mandatory requirement for all applicants except those who are specifically exempt from obtaining PAN (as listed in Exemptions/ Clarifications to PAN section). An admissible proof of identity should have a valid photograph of the applicant on it.
  2. Unique Identification Number (UID): This could be your Aadhaar card/ Passport/ Voter ID card/ driving licence)
  3. Identity (with applicant’s photo) attesting document issued by any of the following agencies:

  • Central or State Government and its departments
  • Statutory/ Regulatory bodies
  • Public Sector Undertakings (PSU companies)
  • Scheduled commercial banks or public financial companies
  • Universities / Colleges affiliated to universities
  • Member IDs professional bodies like ICAI, ICWAI, ICSI, Bar Council among others can issue for their members.

List of documents required as proof of address to open Demat account

Documents admissible as Demat account proof of address include:

  • Passport (check for date of expiry)
  • Voters ID card (with valid photograph)
  • Registered sale or lease agreement of the house
  • Driving licence with photograph
  • Maintenance bill
  • Insurance paper
  • Utility or telephone bills
  • Electricity bills (older than 3 months are not admitted)
  • Passbook or bank account statement
  • Proof of address attested by bank managers of scheduled banks, scheduled co-operative banks, gazette officer, notary public, elected representatives of legislative assemblies (MLAs), elected members of parliament (MPs)
  • Documents issued by Central or State Government and its departments
  • Statutory/ Regulatory bodies
  • Public Sector Units (PSU companies)
  • Scheduled commercial banks or public financial companies
  • Authorised universities (or colleges affiliated to universities)
  • Professional bodies like ICAI, ICWAI, Bar Council among others can issue it for their members.

List of documents required as proof of income

List of documents admissible as Proof of Income to open a Demat account with an authorised bank/ broker or any other financial organisation are:

  • A photocopy of the Income Tax Return (ITR) acknowledgement slip submitted to the Income Tax Department during filing of income tax
  • Proof of Salary in the form of a recent Salary Slip or relevant document which proves income or net worth like Form 16
  • A Net Worth Certificate certified by a Chartered Accountant; alternatively, a photocopy of the Annual Accounts duly audited by a qualified Chartered Accountant
  • Current bank a/c statement reflecting the income history of the client for the past six months
  • A statement of Demat account holdings with an eligible Depository Participant
  • Other documents that substantiate ownership of assets through self-declaration along with documents supporting the claim
  • Cancelled personalized cheque
  • Documents to substantiate ownership of assets.
  • Bank account statements for last six months
  • Power of Attorney or POA: Along with the other documents you will also need to sign agreement papers like the Power of Attorney given to the broker for transfer of securities to settle margins, for settlement of trades and transfer of funds from your account. The POA document has your Demat and bank account details. It is important to note that it must be given out in the name of the brokerage and not in the name of the employee concerned.

List of people authorized to attest the documents

The list of people who are authorised to attest documents for opening of a Demat account are:

A Gazetted Officer, Notary Public, Manager of a Scheduled Commercial/Cooperative Bank or Multinational Foreign Banks. Ensure that you have incorporated the Name, Designation and office seal affixed on the copy.

In the case of Non-Resident Indians (NRIs), authorised officials of overseas branches of Scheduled Commercial Banks registered in India, Court Magistrate, Judge, Notary Public, and Indian Embassy/Consulate General in the country where the client resides can attest the documents

Apart from these documents, the Depository participant or your bank/ broker might ask you for additional certificates as identity, address, and income proof. Once all the documents are submitted, verified, and checked by the departments concerned, your DP will open your account after which you can commence trading.

FAQs

Is opening a Demat account for a minor a tedious task?

The procedure for opening a Demat account for a minor is rather simple. The guardian needs to provide the required documents such as the proof of identity, proof of address, photocopy for the proof of age, and photographs to the Depository Participant (DP) concerned. The DP then verifies the documents and captures the PAN card details of the minor in the DPM system post verification. Upon successful submission and verification of the submitted documents, a Demat account for minor will be created.

What are the benefits of a Demat account?

One of the biggest advantages of opening a Demat account is the low risks involved. Physical securities pose a threat in the form of thefts, losses, or damages are completely eliminated with the opening of a Demat account, which provides holders with the option of holding all their investments in electronic form. It helps easy holding of certificates as maintaining physical papers are a tedious job. It also cuts down on time and costs as there is no paperwork involved. Also, you can do away with additional costs including stamp duty, which is required in the case of physical share trading.

Can I change my address in Demat account?

Yes. To change your address in the Demat account, the following documents are required: Request for change of address in the prescribed format signed by all the account holders, self-attested identity proof of all the account holders, new address proof, and self-attested proof of new (Correspondence/Permanent) address in the name of the first holder.

Who all are involved in the opening of a Demat account?

Apart from the two Depositories in India — the National Securities Depositories Ltd (NSDL) and Central Depository Services Ltd (CDSL); through whom the shares are held by the various depository participants — other parties involved in Demat account transaction are Depository Participant (DP) or authorized stockbroking firm; financial institution, i.e. the bank; clearing houses which take care of debiting or crediting of shares, National Securities Clearing Corporation Ltd (NSCCL) under NSE and Indian Clearing Corporation Ltd (ICCL) under BSE; and stock exchange.You can now invest in mutual funds with moneycontrol. Download moneycontrol transact app. A dedicated app to explore, research and buy mutual funds.

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