Business Mantra News
A Demat account is an account to keep shares and stocks in electronic form. Demat account stores or converts all physical shares into Dematerialized form. So every shareholder is required to have Demat account for trading of shares and stocks. To maintain Demat account one has to pay Annual Maintenance Charges (AMC). Hence, if there is zero balance or inactive account then it would be good suggestion to close that account to save unnecessary AMC of Demat account. One has to ensure following things before closing of Demat account:-
- Firstly, one has to transfer all shares and holding lying in Demat account either to another Demat account or to get it back in physical form.
- There must not be any negative balance in the account and if any it must be settled before closing of Demat account otherwise the depository may reject application for the closure of account.
- All charges as to the maintenance of account like AMC should have been paid or cleared before the closing of account.
Procedure for closing of Demat account:
- One has to visit to the website of depository participant (DP) and download application form for the closing of account.
- After filling of form, one has to submit the form along with KYC documents with the DP Branch.
- Depository Participant ID i.e. DP ID.
- All the demographic details like name and address
- And the reasons for closing of account should be mentioned in the account closing form.
- Application form should be signed by all the holders of Demat account.
- It will take 7 to 10 days to close the Demat account after submission of account closure request form.
It is noted that no fees is being charged for the closure of Demat account from the account holder.