| |
|
|
Depository Participants FAQ's |
| I. General |
| 1. |
What is a depository? |
| Ans. |
A depository can be compared to
a bank. A depository holds securities (like shares, debentures,
bonds, Government Securities, units etc.) of investors in
electronic form. Besides holding securities, a depository
also provides services related to transactions in securities. |
| 2. |
How can I avail the service
of a depository? |
| Ans. |
A depository interfaces with the
investors through its agents called Depository Participants
(DPs). If an investor wants to avail the services offered
by the depository, the investor has to open an account with
a DP. This is similar to opening an account with any branch
of a bank in order to utilise the bank's services. Suggestions
on how to select a DP are given in Section IV. |
| II. Benefits |
| 1. |
What are the benefits of participation
in a depository? |
| Ans. |
The benefits of participation in a depository
are:
- Immediate transfer of securities;
- No stamp duty on transfer of securities;
- Elimination of risks associated with physical certificates
such as bad delivery , fake securities , etc.;
- Reduction in paperwork involved in transfer of
securities;
- Reduction in transaction cost;
- Nomination facility;
- Change in address recorded with DP gets registered
electronically with all companies in which investor
holds securities eliminating the need to correspond
with each of them separately;
- Transmission of securities is done by DP eliminating
correspondence with companies;
- Convenient method of consolidation of folios/accounts
;
- Holding investments in equity, debt instruments
and Government securities in a single account;
- Automatic credit into demat account, of shares,
arising out of split/consolidation/merger etc.
|
| III. Services |
| 1. |
What are the facilities offered
by NSDL? |
| Ans. |
NSDL offers following facilities: -
- Dematerialisation i.e., converting physical certificates
to electronic form;
- Rematerialisation i.e., conversion of securities
in demat form into physical certificates;
- Facilitating repurchase / redemption of units of
mutual funds;
- Electronic settlement of trades in stock exchanges
connected to NSDL;
- Pledging/hypothecation of dematerialised securities
against loan;
- Electronic credit of securities allotted in public
issues, rights issue;
- Receipt of non-cash corporate benefits such as
bonus, in electronic form;
- Freezing of demat accounts, so that the debits
from the account are not permitted;
- Nomination facility for demat accounts;
- Services related to change of address;
- Effecting transmission of securities;
- Instructions to your DP over Internet through SPEED-e
facility. (Please check with your DP for availing
the facility);
- Account monitoring facility over Internet for clearing
members through SPEED facility;
- Other facilities viz. holding debt instruments
in the same account, availing stock lending/borrowing
facility, etc.
|
| IV. Account
Opening |
| 1. |
You mentioned that I would have
to open an account with a DP if I want to participate in the
depository. Who is a DP? |
| Ans. |
NSDL provides its services to investors
through its agents called depository participants (DPs). These
agents are appointed by NSDL with the approval of SEBI. According
to SEBI regulations, amongst others, three categories of entities
i.e. Banks, Financial Institutions and Members of Stock Exchanges
[brokers] registered with SEBI can become DPs. You can get
a list of DPs from NSDL's office or from our website at www.nsdl.co.in. |
| 2. |
How do I select a DP? |
| Ans. |
You can select your DP to open
a demat account just like you select a bank for opening a
savings account. Some of the important factors for selection
of a DP can be:
- Convenience - Proximity to your office/residence, business
hours.
- Comfort - Reputation of the DP, past association with
the organisation, whether the DP is in a position to give
the specific service you may need?
- Cost - The service charges levied by DP and the service
standards.
In order to obtain the complete list of DP locations and
their comparative charge structure, you may log on to www.nsdl.co.in
or else you may write to NSDL for the same. |
| 3. |
Whether all the DPs are same? |
| Ans. |
All the DPs are appointed subject
to fulfilment of uniform requirements of SEBI ( Depositories
and Participants) Regulations, 1996 and requirements of NSDL.
However, the type of services offered and the service standards
may differ among various DPs. For example, a DP branch having
direct connectivity with the main office having depository
set-up may be in a position to execute instructions faster.
|
| 4. |
What should I do when I want
to open an account with a DP? |
| Ans. |
You can approach any DP of your choice and
fill up an account opening form. At the time of opening
an account, you have to sign an agreement with DP in a
NSDL prescribed standard agreement, which details your
and your DPs rights and duties. All investors have to
submit following proof of identity and proof of address
along with the prescribed account opening form
- Proof of Identity : Your signature and photograph
must be authenticated by an existing demat account
holder with the same DP or by your bank . Alternatively,
you can submit a copy of Passport, Voters Id Card,
Driving License or PAN card with photograph.
- Proof of Address : You can submit a copy of Passport,
Voters Id Card, Driving License or PAN card with photograph,
ration card or bank passbook as proof of address.
- Passport-size photograph: You must remember to
take original documents to the DP for verification.
You should remember to obtain a copy of the agreement
and schedule of charges for your future reference.
|
| 5. |
Can I open more than one account
with the same DP? |
| Ans. |
Yes. You can open more than one
account with the same DP. There is no restriction on the number
of accounts you can open with a DP. |
| 6. |
Am I restricted to having account
with only one DP? |
| Ans. |
No. There are no restrictions on
the number of DPs you can open accounts with. Just as you
can have savings or current accounts with more than one bank,
you can open accounts with more than one DP. |
| 7. |
Do I have to keep any minimum
balance of securities in my account with my DP? |
| Ans. |
No. The depository has not prescribed
any minimum balance. You can have zero balance in your account.
|
| 8. |
Can I open a single account
for securities owned in different ownership patterns such
as securities owned individually and securities owned along-with
my wife ? |
| Ans. |
No. The demat account must be
opened in the same ownership pattern in which the securities
are held in the physical form. e. g. if one share certificate
is in your individual name and another certificate is jointly
held in your and your wife's name , two different accounts
would have to be opened. |
| 9. |
What do I do if I have physical
certificates with the same combination of names, but the sequence
of names is different. i.e. some certificates with husband
as first holder and wife as second holder and other set of
certificates with wife as first holder and husband as the
second holder? |
| Ans. |
In this case you may open only
one account with husband and wife as the account holders and
lodge the security certificates with different order of names
for dematerialisation in the same account. You will fill-up
an additional form called " Transposition cum Demat" form.
This would help you to effect change in the order of names
as well as dematerialise the securities. |
| 10. |
Can someone else operate my
account on my behalf on the basis of a power of attorney ? |
| Ans. |
Yes. If you authorise any person
to operate your account by executing a power of attorney and
submit it to your DP, that person can operate the account
on your behalf. |
| 11. |
Why should I give my bank account
details at the time of account opening? |
| Ans. |
It is for protection of your interest.
Your bank account number will be mentioned on the interest
or dividend warrant, you are entitled to, so that such warrant
cannot be encashed by any one else. Further, a DP cannot open
the account if bank account number is not given. |
| 12. |
Can I change details of my bank
account? |
| Ans. |
Yes. Since in the depository system
monetary benefits on your security balances are paid as per
the bank account details provided by you at the time of account
opening , you must ensure that any subsequent change in bank
account details is informed to your depository participant.
|
| 13. |
What is 'Standing Instruction'
given in the account opening form? |
| Ans. |
In a bank account, credit to the
account is given only when a 'paying in' slip is submitted
together with cash/cheque. Similarly, in a depository account
'Receipt in' form has to be submitted to receive securities
in the account. However, for the convenience of investors,
facility of 'standing instruction' is given. If you say 'Yes'
for standing instruction, you need not submit 'Receipt in'
slip everytime you buy securities. |
| 14. |
Can I operate a joint account
on "either or survivor" basis just like a bank account? |
| Ans. |
No. The demat account cannot be
operated on "either or survivor" basis like the bank account.
|
| 15. |
Can I add or delete names of
accountholders (second or third accountholder) after opening
the account ? |
| Ans. |
No. Names of the accountholders
for a depository account cannot be changed. If you want to
change name or add / delete an accountholder, you need to
open a new account in the desired holding pattern (names)
and transfer the securities to the newly opened account. The
old account may be closed. |
| 16. |
What should I do if my address
is changed? Do I need to write to each company separately? |
| Ans. |
In case your address is changed,
you only need to inform the new address to your DP(s). When
DP enters the new address in the depository computer system,
it will be automatically conveyed to all companies in which
you hold shares. |
| 17. |
Can I close my demat account
with one DP and transfer all securities to my account with
another DP ? |
| Ans. |
Yes. You can submit account closure
request to your DP in prescribed form. Your DP will transfer
all your securities, as per your instruction, and close your
demat account. |
| 18. |
What would be the charges for
account closure and securities transfer due to account closing? |
| Ans. |
The charges would be as per the
schedule of charges of your DP, agreed by you at the time
of account opening or any subsequent changes therein. |
| V. Nomination |
| 1. |
Who can nominate? |
| Ans. |
Nomination can be made only by
individuals holding beneficiary accounts either singly or
jointly. Non-individuals including society, trust, body corporate,
partnership firm, karta of Hindu Undivided Family, holder
of power of attorney cannot nominate. |
| 2. |
Can joint holders nominate? |
| Ans. |
Yes. Nomination is permitted for
accounts with joint holders. But, in case of death of any
of the joint holder(s), the securities will be transmitted
to the surviving holder(s). Only in the event of death of
all the joint holders, the securities will be transmitted
to the nominee. |
| 3. |
Can a NRI nominate? |
| Ans. |
Yes, NRI can nominate directly.
But, the power of attorney holder cannot nominate on behalf
of NRI. |
| 4. |
Can a minor nominate? |
| Ans. |
No, a minor cannot nominate either
directly or through its guardian. |
| 5. |
Who can be a nominee? |
| Ans. |
Only an individual can be a nominee.
A nominee shall not be a society, trust, body corporate, partnership
firm, karta of Hindu Undivided Family or a power of attorney
holder. |
| 6. |
Can there be more than one nominee? |
| Ans. |
Ans. No, only one nomination can
be made for one depository account. |
| 7. |
Can a minor be a nominee? |
| Ans. |
Yes, a minor can be a nominee.
In such a case, the guardian will sign on behalf of the nominee
and in addition to the name and photograph of the nominee,
the name, address and the photograph of the guardian must
be submitted to the DP. |
| 8. |
Can separate nomination be made
for each security held in a depository account? |
| Ans. |
No. Nomination can be made account
wise and not security wise. |
| 9. |
Can a NRI be a nominee? |
| Ans. |
Yes, NRI can be a nominee subject
to the exchange control regulations in force from time to
time. |
| 10. |
What is the procedure for nomination? |
| Ans. |
The nomination form duly filled-in
should be submitted to the DP either at the time of account
opening or later. The account holder, nominee and two witnesses
must sign this form and the name, address and photograph of
the nominee must be submitted. If nomination was not made
at the time of account opening , it can be made subsequently
by submitting the nomination form. |
| 11. |
Can the nominee be changed? |
| Ans. |
Yes, the nomination can be changed
anytime by the account holder/s by simply filling up the nomination
form once again and submitting it to the DP. |
| VI. Transmission |
| 1. |
What does transmission mean
in relation to demat accounts? |
| Ans. |
Transmission is the process by
which securities of a deceased account holder are transferred
to the account of the surviving joint holder(s)/nominee/legal
heirs of the deceased account holder. Process of transmission
in case of dematerialised holdings is more convenient as the
transmission formalities for all securities held in a demat
account can be completed by submitting documents to the DP
whereas in case of physical securities the surviving joint
holder(s)/nominee/ legal heirs has to correspond independently
with each company in which shares are held. |
| 2. |
What is the procedure for transmission
of securities to the nominee in case of the death of the sole
account holder ? |
| Ans. |
In case of the death of the sole
holder , for the purpose of transmission of securities, the
nominee has to submit a duly filled-in transmission form,
notarised copy of death certificate and an affidavit in the
prescribed format to the DP. After verifying these documents
and if found in order, the DP will transmit the securities
to the account of the nominee. |
| 3. |
What would happen if no nomination
is made for the account? |
| Ans. |
In case nomination is not made
by the sole account holder, the securities would be transmitted
to the account of legal heir(s), as may be determined by an
order of the competent court. However in cases where the value
of securities to be transmitted is less than Rs. 1,00,000/-
the DP may process the request based on submission of necessary
letter of indemnity , surety , affidavits and NOC documents.
|
| 4. |
What is the procedure for transmission
in case of Joint Accounts ? |
| Ans. |
In the event of death of one of
the joint holders , the securities will be transmitted to
the surviving holder(s) on submission of Transmission Form
and notarised copy of the death certificate of the deceased
joint holder to the DP. For transmission of securities, the
account of the surviving holder(s) must be in the same sequence
in which the names appear in the joint account to be closed.
|
| VII. Dematerialisation |
| 1. |
What do you mean by dematerialisation? |
| Ans. |
Dematerialisation is the process
by which physical certificates of an investor are converted
to an equivalent number of securities in electronic form and
credited in the investor's account with its DP. In order to
dematerialise certificates; an investor will have to first
open an account with a DP and then request for the dematerialisation
of certificates by filling up a dematerialisation request
form [DRF], which is available with the DP and submitting
the same along with the physical certificates. The investor
has to ensure that before the certificates are handed over
to the DP for demat, they are defaced by marking "Surrendered
for Dematerialisation" on the face of the certificates. |
| 2. |
Can I dematerialise any share
certificate? |
| Ans. |
You can dematerialise only those
certificates that are already registered in your name and
are in the list of securities admitted for dematerialisation
at NSDL. All the scrips included in S&P, CNX, NIFTY and BSE
SENSEX have already joined NSDL. This list has more than 4,300
companies and is steadily growing. You can get an updated
list of these companies from your DP or from NSDL's office
or from NSDL website at www.nsdl.co.in. |
| 3. |
What precautions should I take
before defacing a share certificate? |
| Ans. |
Before defacing the share certificate,
you must ensure that it is available for dematerialisation.
You must therefore check with your Depository Participant
(DP) whether the ISIN (code number for the security in a depository
system) has been activated and made available for dematerialisation
by the depository. If yes, then you may deface the share certificate.
The certificates are defaced by marking "Surrendered for Dematerialisation"
on the face of the certificate. |
| 4. |
How long does the dematerialisation
process take? |
| Ans. |
Dematerialisation will normally
take about 30 days. |
| 5. |
What if it takes more than 30
days for dematerialisation of the shares? |
| Ans. |
If the process of dematerialisation
takes more than 30 days, please contact your DP. If he is
unable to help you, then you may send your grievance to:
The Officer in Charge
Investor Grievance Cell
National Securities Depository Limited
4th Floor, Trade World
Kamala Mills Compound
Senapati Bapat Marg
Lower Parel, Mumbai - 400 013
Email: relations@nsdl.co.in
|
| VIII.
Government Securities and Debt Instruments |
| 1. |
Can I dematerialise my debt
instruments , mutual fund units , government securities also
in my demat account ? |
| Ans. |
Yes. You can dematerialise and
hold all such investments in a single demat account. |
| IX. Rematerialisation |
| 1. |
Can my electronic holdings be
converted back into certificates? |
| Ans. |
Yes. If you wish to get back your
securities in physical form, all you have to do is to request
your DP for rematerialisation of the same. 'Rematerialisation'
is the term used for converting electronic holdings back into
certificates. Your DP will forward your request to NSDL, after
verifying that you have the necessary balance. NSDL in turn
will intimate the registrar who will print the certificates
and dispatch the same to you. |
| X. Trading
/ Settlement |
| 1. |
What is the procedure for selling
dematerialised securities? |
| Ans. |
The procedure for selling dematerialised
securities is very simple. After you have sold the securities,
you would instruct your DP to debit your account with the
number of securities sold by you and credit your broker's
clearing account. This delivery instruction has to be given
to your DP using the delivery instruction slips given to you
by your DP at the time of opening the account. Procedure for
selling securities is given here below:
- You sell securities in any of the stock exchanges linked
to NSDL through a broker;
- You give instruction to your DP to debit your account
and credit the broker's [clearing member pool] account;
- Before the pay-in day, your broker gives instruction
to its DP for delivery to clearing corporation;
- Your broker receives payment from the stock exchange
[clearing corporation] ;
- You receive payment from the broker for the sale of
securities.
|
| 2. |
How can I purchase dematerialised
securities? |
| Ans. |
For receiving demat securities
you may give a one-time standing instruction to your DP. This
standing instruction can be given at the time of account opening
or later. Alternatively, you may choose to give separate receipt
instruction every time some securities are to be received.
The transactions relating to purchase of securities are summarised
below:
- You purchase securities through a broker ;
- You make payment to your broker who arranges payment
to clearing corporation on the pay-in day ;
- Your broker receives credit of securities in its clearing
account (clearing member pool account) on the pay-out
day;
- Your broker gives instructions to its DP to debit clearing
account and credit your account;
- You receive shares into your account. However, if standing
instructions are not given at the time of opening the
account, you will have to give 'Receipt Instructions'
to your DP for receiving credit,.
You should ensure that your broker transfers the securities
from its clearing account to your depository account, before
the book closure. If the securities remain in the clearing
account of the broker, the company will give corporate benefits
(dividend or bonus) to the broker. In that case, you will
have to collect the benefits from your broker. |
| 3. |
What do you mean by 'Market
Trades' and 'Off Market Trades'? |
| Ans. |
Any trade settled through a clearing
corporation is termed as a 'Market Trade'. These trades are
done through stock brokers on a stock exchange. 'Off Market
Trade' is one which is settled directly between two parties
without the involvement of clearing corporation. The same
delivery instruction slip can be used either for market trade
or off-market trade by ticking one of the two options. |
| 4. |
If I sell securities through
a sub-broker, which part of the delivery instruction slip
should be filled? |
| Ans. |
If you are delivering securities
to your sub-broker you would need to fill-in the off-market
trade portion of the delivery instruction slip. |
| 5. |
What settlement details are
required on the delivery instruction slip? |
| Ans. |
On every stock exchange, various
settlements are effected every day such as daily settlement
, auction settlement etc. Each of these settlements is identified
by combination of a market type and a settlement number. You
are required to mention the appropriate settlement details
on the delivery instruction slip while transferring the shares
to your broker's account. These settlement details are available
on the contract note issued by the broker. |
| 6. |
What is T+3 rolling settlement
cycle and when delivery is to be given to a broker ? |
| Ans. |
In case of T+3 rolling settlements
, the trades taking place on each trading day are required
to be settled on the third day following the date of trade.
For example trades of Monday will be settled on Thursday morning.
In this example, if you have sold securities, you need to
make sure that the securities reach the account of clearing
member of the stock exchange latest by Wednesday. |
| 7. |
In case of T+3 rolling settlement
cycle if I am trading (selling) through a sub-broker when
do I need to give delivery instruction to my DP? |
| Ans. |
In this case also the settlement
deadlines will remain the same (i.e. Thursday morning for
a Monday trade). However, there is an additional transfer
involved. You will transfer securities to the sub-broker's
account and the sub-broker will further transfer the securities
to the account of clearing member. Therefore, in this case
you should give delivery instructions to your DP immediately
after confirmation of sale transaction. |
| 8. |
How do I come to know about
the settlement deadlines? |
| Ans. |
The depository participant with
whom you have your demat account will prescribe the deadlines
to be followed by you for submission of delivery instruction
slips. You should deliver instructions to your DP as per these
deadlines. |
| 9. |
When I buy shares, in what time
should I receive the securities from my broker? |
| Ans. |
The broker is expected to transfer
the securities to you within two working days or four calendar
days after securities are received in his pool account, provided
you have made the requisite payment to the broker. |
| 10. |
What precautions do I need to
observe with respect to Delivery Instruction Slips [DIS]? |
| Ans. |
The following precautions are
to be taken :-
- Ensure and insist with your DP to issue DIS book; do
not accept loose slips.
- Ensure that DIS numbers are pre-printed and DP takes
acknowledgment from you for the DIS booklet issued to
you.
- Ensure that your account number [client id] is pre-stamped.
- If your account is a joint account, all the joint holders
have to sign the instruction slips. Instruction cannot
be executed if all joint holders have not signed.
- Avoid using loose slips
- Do not leave signed blank DIS with anyone viz. broker/sub-broker.
- Keep the DIS book under lock and key when not in use.
- If only one entry is made in the DIS , strike out remaining
space to prevent misuse by any one.
- Please fill in target account -Id and all details in
the DIS, yourself.
|
| 11. |
What is 'execution date' given
in the delivery instruction form? |
| Ans. |
Execution date is the date on
which securities will be actually debited from your account.
The execution date written on the delivery instruction has
to be entered by the DP, in the DPM system [computer]. DPM
system will record the date and will debit your account only
on that date. You may issue the instruction well in advance
of the date on which you want the securities to be debited
from your account but your account will be debited only on
the execution date. This facility is called future execution
date facility. |
| 12. |
What benefit do I get by giving
delivery instruction with a future execution date? |
| Ans. |
By giving a future dated instruction
the risk of non-execution of instruction due to lack of time
or last minute rush is covered. |
| 13. |
What is the importance of record
dates to me? |
| Ans. |
In case the securities bought
by you are yet to be transferred into your account by your
broker before the book closure / record date, you will not
be entitled to receive corporate benefits such as dividend
or bonus since your name will not figure in the list of beneficial
owners. Hence, you must ensure that securities bought by you
are transferred into your account before the book closure
/ record date announced by the company. |
| XI. Speed-e
Facility (Internet Facility) |
| 1. |
Is it possible to give delivery
instructions to the DP over Internet and if yes how? |
| Ans. |
Yes. NSDL has recently launched
a facility for delivering instructions to your DP over Internet
, called SPEED-e. The facility can be used by all registered
users. Your DP will help you in registering for the facility.
|
| 2. |
How does SPEED-e work? |
| Ans. |
You can submit delivery instructions
electronically, on the SPEED-e website https://www.speed-e.nsdl.com,
after your DP has authorised you to operate your account through
the SPEED-e facility. You can monitor the status of such delivery
instructions to ensure that the instructions have been executed.
|
| 3. |
How can I, as a Demat Account-holder
/ Clearing Member benefit from SPEED-e? |
| Ans. |
The benefit offered by SPEED-e
to a demat account holder / Clearing Member is the convenience
of conducting demat account transactions using an Internet
connection from anywhere at anytime eliminating paperwork.
Time and efforts for obtaining delivery instruction forms
from your DP and submitting them to the DP everytime you sell
securities is saved. |
| 4. |
How can I register myself for
SPEED-e? |
| Ans. |
For using the SPEED-e facility
it is essential that your DP must be registered with NSDL
for this facility. There are two types of users for this facility
, one is password based user who logs in with his password
and can transfer securities only to three pre-specified broker
accounts of his choice. The second is the smart-card based
user who is issued a smart card for logging on to the site
and can transfer the securities to any account. A password
user can visit the SPEED-e website, fill-up the registration
form available on the website. The website would allot a registration
number and the DP of the client would authorise him for using
the facility upon submission of a request with the registration
number.
A smart card user can download the form from the website,
fill it and submit the same to its DP. The DP will process
the form and enable the client for using the facility. The
smart card user will also be issued a smart card reader
and a smart card. |
| 5. |
What is the difference between
Smart-card and Password based access to SPEED-e? |
| Ans. |
Smart card based access to SPEED-e
is more secure as your identification is based both on "What
you have i.e. smart card" and "what you know i.e. PIN code"
and provides a digital signature to identify you. In the case
of password based access , you should handle your password
carefully. In view of this security difference, the password
based users have been permitted to transfer securities through
SPEED-e facility to only three pre-specified broker accounts.
These three accounts can be changed by the user. |
| 6. |
Is there any further benefit
of the smart card option in SPEED-e facility? |
| Ans. |
Following are the additional benefits
of smart card option in SPEED-e facility :
- smart card user can transfer securities to any account
unlike password users where transfer of securities is
permitted only to three pre-notified broker accounts;
- single smart card can be used to access all your demat
accounts, opened with the same DP;
- facility of multiple authorisation;
- you can freeze your demat account or any particular
ISIN or specific quantity within an ISIN yourself, through
SPEED-e. The account freezed using SPEED-e can be unfreezed
only by you.
Thereby you can deliver instructions and transfer securities
when you wish, lock the account and unlock it only when
you need, i.e. complete control of your account in your
hands. |
| 7. |
How does one operate jointly
held Demat Accounts through SPEED-e? |
| Ans. |
For password based operation,
only one user can operate the account. Joint holders will
have to give a power of attorney to one joint holder among
themselves. For smart card based operation, in addition to
what is stated above, all the joint holders can operate the
account independently or jointly using multiple authorisation
facility. |
| XII. Corporate
Benefits |
| 1. |
How would I get my dividend
/ interest or other cash entitlements? |
| Ans. |
The concerned company obtains
the details of beneficiary holders and their holdings from
NSDL. The payment to the investors will be made by the company
through the ECS ( Electronic Clearing Service) facility or
by issuing warrants on which your bank account details are
printed. The bank account details will be those which you
would have mentioned in your account opening form or changed
thereafter. |
| 2. |
How would I get my bonus shares
or other non-cash entitlements? |
| Ans. |
The concerned company obtains
the details of beneficiary holders and their holdings from
NSDL. Your entitlement will be credited by the company directly
in your NSDL depository account. |
| 3. |
How will the investor confirm
that bonus/rights entitlement is credited into the account? |
| Ans. |
An allotment advice will be sent
by the Issuer/ its R&T agent for bonus/ rights entitlement.
The Transaction Statement given by the DP, will also show
the bonus/ rights credit into the account. The quantity shown
in the advice and statement of transaction should match. |
| XIII.
Pledging |
| 1. |
What should I do if I want to
pledge electronic securities? |
| Ans. |
The procedure is as follows:
- Both you (pledgor) as well as the lender (pledgee)
must have depository accounts;
- You have to initiate the pledge by submitting to your
DP the details of the securities to be pledged in a standard
format ;
- The pledgee has to confirm the request through its
DP. It is suggested that after creation of the pledge
request, you may inform the pledgee and request him to
confirm the request;
- Once this is done, your securities are pledged All
financial transactions between the pledgor and the pledgee
are handled as per usual practice outside the depository
system.
|
| 2. |
How can I close the pledge after
repayment of my loan? |
| Ans. |
After you have repaid your loan,
you can request for a closure of pledge by instructing your
DP in a prescribed format. The pledgee on receiving the repayment
will instruct its DP accordingly for the closure of the pledge.
|
| 3. |
Whether pledgee account can
be in a different DP? |
| Ans. |
Yes. The pledgee can have an account
with a different depository participant of NSDL. |
| 4. |
Can I change the securities
offered in a pledge? |
| Ans. |
Yes; if the pledgee [lender] agrees,
you may change the securities offered in a pledge. |
| 5. |
Who will receive dividend on
the pledged securities? |
| Ans. |
Pledgor will continue to receive
dividend on the pledged securities. The pledgee will get the
benefits only if pledge is invoked and on record date the
shares are in the pledgee's account. |
| 6. |
How will the distribution of
bonus shares for pledged shares happen? |
| Ans. |
The software in NSDL has been
modified to handle distribution of bonus entitlements through
Automatic Corporate Action (ACA) Module. This works as follows:
- The holdings as of the record date / book closure,
(including those holdings which are pledged) are considered
for computing bonus entitlements.
- At the time of effecting the credit of bonus shares,
the system checks whether pledge is still open or closed.
- Where pledge orders are not closed / invoked or partially
closed / invoked, the bonus entitlements in such cases
are credited to the pledgor's account with pledge marked
in favour of the pledgee.
- If the pledge is closed/invoked fully, the bonus entitlements
will be credited to the pledgor's account as free balances.
|
| XIV. Securities
Lending and Borrowing
SEBI has introduced Securities Lending and Borrowing scheme.
As per this scheme, those persons having securities can
lend their securities for consideration and those requiring
securities (for meeting market obligations , as collateral
etc.) can borrow the same. Under the scheme, the securities
are lent through intermediaries who are approved by SEBI.
The approved intermediary would borrow the securities for
further lending to borrowers. Lenders of the securities
and borrowers of the securities enter into separate agreements
with the approved intermediary for lending and borrowing
the securities . Lending and borrowing is effected through
the depository system. |
| 1. |
Can I lend the securities lying
in my account ? |
| Ans. |
Yes. You can lend your securities
through Intermediaries approved by SEBI. |
| 2. |
How would I lend my demat securities? |
| Ans. |
You may enter into an agreement
with the approved intermediary to be a lender under this scheme.
After that, you may lend securities any time by submitting
lending instruction to your DP. |
| 3. |
How would I get back the securities
lent by me? |
| Ans. |
Intermediary may return the securities
at any time or at the end of the agreed period of lending.
Intermediary has to repay the securities together with any
benefits received during the period of the loan. |
| 4. |
How would I receive the corporate
benefits which would accrue on these securities during the
period of lending ? |
| Ans. |
The benefits will be given to
the Intermediary/borrower. However, whenever the securities
are being returned/recalled, Intermediary/borrower will return
the securities together with benefits received. |
| XV. Charges |
| 1. |
What will be the charges for
account opening and other depository related transactions? |
| Ans. |
NSDL charges the DPs and not the
investors. NSDL's charges to its DPs are fixed and are based
on the usage of NSDL system. Complete details of NSDL charges
as are payable by the DPs are available on NSDL website (www.nsdl.co.in).
The DP charges its client for the services offered. The charges
that the DP will be charging you for various services are
mentioned in the Schedule of Charges which forms a part of
the account opening agreement. You may keep a copy of this
for your future reference. You can get the details of the
charges from the DPs. You can also get a comparative list
of DP charges from NSDL's office or from the NSDL website.
Your DP may revise charges by giving you 30 days notice
in advance. |
| XVI. Inter
Depository Transfers |
| 1. |
If my depository account is
with NSDL, can I receive my securities from an account holder
having account with some other depository in India? |
| Ans. |
Yes. Inter depository transfers
are possible. |
| XVII.
Safety Features |
| 1. |
How will I know that my DP has
updated my account after each transaction? |
| Ans. |
Your DP will give you a Transaction
Statement periodically, which will detail your current balances
and the various transactions you have done through the depository
account. If you so desire, your DP may provide Transaction
Statement at intervals shorter than the stipulated ones, probably
at a cost. |
| 2. |
At what frequency will I receive
my Transaction Statement from my DP? |
| Ans. |
You will receive a Transaction
Statement from your DP once in a quarter. If you have done
any transaction during the quarter, you will receive the statement
within fifteen days of the transaction. |
| 3. |
What is to be done if there
are any discrepancies in my transaction statement? |
| Ans. |
In case of any discrepancy in
the transaction statement, you can contact your DP. If the
discrepancy cannot be resolved at the DP level, you should
approach NSDL. NSDL also sends out a statement of holdings
to a few clients of DPs, picked at random. In case the balance
in your account as indicated by your DP does not tally with
the balance as indicated by NSDL, you can contact your DP/
NSDL for clarification. |
| 4. |
What happens if I lose my Transaction
Statement? |
| Ans. |
You should inform your DP and
obtain a duplicate Transaction Statement. |
| 5. |
What security do I have if the
only proof of my holdings in the depository is merely a piece
of paper indicating my account balance? |
| Ans. |
No transaction can be effected
in your account without your written authorisation. Further,
if you are away for a long time, you have the facility of
freezing your account wherein only credits into your account
will be allowed and no debit will be possible. |
| 6. |
What will happen if my DP goes
bankrupt or stops operation? |
| Ans. |
In a rare event of your DP going
bankrupt or closing the operations, the interests of the investors
will be fully protected. In such a situation, the investors
will be given an option of either transferring the securities
to a new DP or they may rematerialise the securities. |
| 7. |
What precautions does NSDL take
to protect the data in its depository system? |
| Ans. |
The data carries a high importance in the NSDL
depository system. NSDL has taken necessary steps to protect
the transmission and storage of data. The data is protected
from unauthorised access, manipulation and destruction.
The following back up practices are adopted to protect
the data:
- Local Back up
- Remote Back up
- Disaster Recovery Site
In addition to this, every DP is required to take daily
back up, at the end of each day of operation. |
| 8. |
Can I freeze my account? |
| Ans. |
NSDL system provides the facility
to freeze the depository accounts for any debits or for both,
debits and credits. In an account which is "freezed for debits",
no debits will be permitted from the account, till the time
it is unfreezed. |
| 9. |
What should I do if my DP is
unable to resolve my problem? |
| Ans. |
In case of failure of a DP to
resolve your grievance, you can write to the investor grievance
cell of NSDL at the following address:
The Officer in Charge
Investor Grievance Cell
National Securities Depository Limited
4th Floor, Trade World
Kamala Mills Compound
Senapati Bapat Marg
Lower Parel, Mumbai - 400 013
Email : relations@nsdl.co.in
|
|
|
|
|
|
|
