Home Finance Why Should One Open a Demat Account Online in India?

Why Should One Open a Demat Account Online in India?

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Before entering the Stock market, investors and traders must be aware of some factors responsible for its efficient functioning. The first step for stock market investors and traders is to open a Demat account online in India. A Demat account is an electronic form of account that facilitates the storage of financial assets such as Stocks, Bonds, Mutual funds, etc. They are also known as Dematerialized accounts. 

  • There are plenty of advantages after you open a Demat account online. It reduced the time required for clearing, eliminated fraud cases, lowered brokerage rates, and increased trading volume exponentially. 
  • It can give quick and easy access to your investments and statements through net banking. 

These are the reasons that prove how the Demat account has been beneficial for stock market investors and traders. As earlier, all the transactions took place in physical certificates. A Demat account is more or less like a Bank account, but instead of money, it holds stocks and other financial assets. As per your request, a Security will get debited and credited to your Demat account.

Many stocks broking firms in India offer Demat account opening, and Kotak Securities is one of them. They provide an easy and convenient way to open a Demat account online for free. You can open a Demat account online in Kotak Securities from anywhere at any time.

Demat accounts have replaced the time-consuming process with a quick and easy method to receive dividends, interest, or refunds. They are all auto-credited in the Demat account. 

The transfer of shares has also become much more manageable. Earlier, the physical transfer of shares would take almost one month. Since the arrival of the Demat account, the process of transferring shares got abridged, and the cost got reduced. There is no stamp duty on the transfer of  Securities held in the electronic form. Even the buying or selling of shares was a lengthy process with a lot of paperwork.  That made the process tedious and insecure. The Demat account has made this troublesome procedure convenient and that too quickly. 

As a Demat account holder, you can avail a loan against the  Securities held in your Demat account. The Demat account holder can freeze specific types or quantities of securities in a Demat account. You even can freeze your Demat account for a certain period. The freezing of a Demat account depends on the account owner, and they can choose to do it for a specific time. With a frozen Demat account, you do any credit or debit transactions until the period in which it got frozen. 

Demat accounts have played a significant part in giving foreign investors easy access to the  Stock market in India. The increase in the growth of monetary value in the  Indian Stock market helps grow the Indian economy concurrently. 

If all the documents are in paper form, the chances of misplacing increase. However, the cases of financial documents getting forged have given most of us sleepless nights. But, there is no concept of a paper form with a Demat account. It guarantees 100% safety. Hence, it is a better, more secure, and more reliable option to store  Shares and other Securities in a Demat account. These are all the advantages of why one should open a Demat account online.

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