Last year, April to November witnessed an increase of 2.21 crore online Demat accounts in the market, according to the Economic Survey of 2021-22.
The key takeaway from this information is that the Indian stock market enjoys the active participation of retail investors. This trend, as experts predict, is to continue far and beyond, hopefully enabling India’s market to grow as big as the NYSE.
But before you get on to establishing yourself as a successful market participant, you will need to open a Demat account. Today, we will help you do that by telling you things to know before opening Demat account.
Table of Contents
Top 10 Things To Know Before Opening Demat Account
- Uses of Demat account
- Trading and investing requirements
- Reliability of broking platform
- Pricing and brokerage charges
- Documents required to open Demat account
- Account opening process
- 2 in 1 Account Service
- SEBI registration of broker
- Data security and safety policies of broker
- Miscellaneous facts and features
Lets dive deeper into these 10 points…
1. Uses of Demat Account
Before you buy assets, you need to know – what is a Demat account, and why do you need one? A Demat account, is an account that records, stores, maintains, and transfers shares and other securities on your behalf.
2. Trading and Investing Requirements
There are multiple financial products available in the market these days. Not all brokers provide market participants with the facility of trading under a single umbrella. The charges for trading also differ product-wise.
Hence, if you’d like to experience multi-product trading, then it is imperative to go with one that provides a comprehensive host of services at reasonable rates.
3. Reliability of Broking Platform
Choosing to open a Demat account with a reliable online stock broker like can allow you to access user-first features backed by technology. This can come in handy when trying to trade and invest at scale.
4. Pricing and Brokerage Charges
There are two sorts of brokers – traditional full-service providers and discount brokers. Whether you need a customized trading plan or want to cut down on broking costs, you can select a broker that suits your needs.
5. Documents Required to Open Demat Account
For the commencement of your Demat account opening journey, you will need to keep the following documents ready:
- Identity Proof such as the Driving License, Aadhaar Card, Pan Card, Passport, Voter’s Card, NREGA Job Card etc.
- Proof of Address such as Driving License, Aadhaar Card, Utility Bill, Passport, Voter’s Card etc.
- Bank Proof such as IFSC, Account Statement, Cancelled Cheque, Passbook, MICR etc.
Here is detailed article on documents required to open Demat account in India.
6. Account Opening Process
You can open a Demat account through the paper or the paperless route. People usually prefer the paperless route of eKYC that gets your process completed in minutes.
At Dhan, you can open 100% paperless demat account in just minutes:
7. 2 in 1 Account Service
Having different Demat and trading accounts could get cumbersome to maintain. So be wise and make your life easier with a 2-in-1 service provider.
8. SEBI Registration of Broker
There are several outliers out there promising you more-than-usual returns – they make us raise an eyebrow. Investors must always have confidence in their brokers, and what’s securer than a SEBI registration! So be sure of going ahead with one.
9. Data Security and Safety Policies of Broker
As everything is on the computers these days, your data must remain secure at all costs. Your broker is responsible for providing upbeat data privacy, so this becomes a crucial checkpoint for you to consider during Demat account opening.
10. Miscellaneous Features & Facts
In India, you’re allowed to open multiple Demat accounts. In fact, you can even transfer shares from one Demat to another.
Conclusion
Demat account opening could open up the world for you – new opportunities coupled with immense learning. Enjoy the process, but also be cautious about investing wisely.
Happy Investing 😇
