How To Close Your Demat Account Online?

When we finally decide to invest and trade, we often lookout for ways to execute the necessary process. One such is creating a Demat account. But with today’s fast-paced worldly affairs, we tend to forget and become lazy and keep postponing things till the last hour. And this might turn out to be an expensive error, especially in the world of the stock market!

Fees and maintenance costs apply to Demat accounts. As a result, it is advised to cancel any of your inactive or zero balance Demat accounts immediately. Otherwise, we will lose money. As a result, knowing how to terminate a Demat account is critical.

Demat or dematerialized accounts are an excellent option for most people to supplement their income. An online account is required for investors who trade in the financial markets.

According to SEBI, the country has around 44.46 million Demat accounts. Basically, a Demat account is an electronic account where your shares and securities are stored. With the economy improving, more individuals are hoping to jump on the stock exchange bandwagon.

Regardless matter how large the statistics are, SEBI has revealed that over 75% of accounts remain dormant. An idle Demat account is a financial drain that incurs yearly fees and maintenance expenses. As a result, it's a good idea to prevent any excessive expenses and terminate your Demat account.

Know These Before Closing Your Demat Account

Note that, your Demat account cannot be simply canceled by submitting an online request for its closure. Be it through email or customer care.

You are ought to submit an application in person that includes the hard copies of all the mandatory papers. But there is also a way out. If you are facing a time crunch, then pace up the entire process by downloading the closure form online.

Follow these basic steps to know how to close Demat account online:

• ·       Make sure that there are no shares in your account.
• ·       Also check whether the account has a negative balance.
• ·       Check your account details by checking in to your account or by contacting your registered branch. Make a note of those details.
• ·       Get your Account Closure form, fill in those required details, and submit it in person.

Two Types of Demat Account Closure!

Account closure: If there are no payments pending or being on hold in your account [you being the investor], then your request to close the Demat account online would be sent.

It would be sent off to the relevant depository partner [also referred to as DP].

Transfer and account closure: This method is a bit different. Suppose, you still have some securities pending and need to be transferred to another Demat account, then go for this method before actually shutting off your original Demat account.

Close Your Demat Account Online

Fill up all the details in the Account Closure Form. If the Demat account is shared by more than one person, it is mandatory for all holders to sign it in the presence of a Depository Participant (DP) official. A brokerage business or a bank can serve as the DP.

Make sure when completing the closure form, you do not forget to include the following information:

• ·       Your ID and the DP ID KYC data, such as name and address, are in sync with your records.
• ·       You also need to explain the reason why you want to close your Demat Account online.
• ·       Finally, don’t forget to attach a self-attested identification proof copy which is verified by a bank employee.

When moving pending holdings or shares from one Demat account to another, the following steps must be taken to cancel or delete a Demat account:

• ·       There are two major national depositories in India, namely, NSDL and CDSL. If you are doing intra-depository transfers then an Intra DIS slip will be required, along with the 'Off-Market transfer option.
• ·       Next, get an original Client Master List [CML] with proper logo, stamp, and signatures.
• ·       After this, fill in the form with all the required data with the names of the shares that have to be transferred.
• ·       Do not ever forget to mention their respective ISINs.
• ·       The target client's ID, a 16-character code, should be specified too.
• ·       Finally, submit your paperwork at the DP's office or simply mail it to their headquarters.
• ·       For closure, a bank official must additionally check the self-attested Demat closure form.

Final Thoughts

Though Demat accounts cannot be entirely closed online, their process can be simplified by completing all the essential paperwork online. It is critical to ensure that there are no outstanding charges, fines, or shares in the account and that all of the information is correct. To avoid errors or lapses, the individual's details must be reviewed before transferring any shares or accounts.