Now that you have a demat account, let’s explore some of its key features and benefits:
Holding Securities in Electronic Form
One of the primary advantages of demat accounts is that they allow you to hold your securities in electronic form. Gone are the days of managing physical share certificates that are susceptible to loss, damage, and forgery. With a demat account, all your securities are securely held in digital format, making it easier to track, manage, and transfer them as needed.
Additionally, demat accounts provide the convenience of easy storage. You no longer need to worry about physically storing heaps of certificates or the risk of misplacing them. Your investments are consolidated in one place, making it simpler to keep track of your holdings.
Seamless Buying and Selling of Securities
Demat accounts enable you to buy and sell securities with ease. When you wish to buy a particular stock or investment, you can place an order through your trading account. Once the transaction is executed, the securities are automatically credited to your demat account. Similarly, when you sell your holdings, the securities are debited from your demat account upon completion of the transaction. This seamless process eliminates the need for physical paperwork, reducing paperwork-related hassles and delays.
Moreover, demat accounts provide you with real-time updates on your holdings. You can easily track the value and performance of your investments without the need for manual calculations or extensive record-keeping.
Quick and Hassle-Free Settlement Process
The settlement process for transactions conducted through demat accounts is quick and efficient. In India, the most common settlement cycle is the T+2 system, where “T” refers to the transaction date. This means that the securities are credited or debited from your demat account within two business days from the transaction date. This expedited settlement process allows for quicker access to funds and easier reinvestment opportunities.
Furthermore, the settlement of securities held in demat accounts is automated. This means that upon completion of a transaction, the securities are automatically debited or credited into the respective demat accounts involved in the trade. This eliminates the need for manual intervention or physical delivery of share certificates, streamlining the entire process.