Demat Accounts are like bank accounts and also operate like on, except they are for investment instruments. Just like once we open bank accounts and forget, its similar for Demat account. If you have no shares in your Demat or would no longer like to trade or invest, it is wiser to close the inactive Demat account.
For keeping the Demat account active, there are fees and maintenance charges. So here we elaborate the steps to close a Demat account,
Preliminary steps to know before closing the account,
First, it’s not entirely possible to close the Demat account online. One has to submit the application for ‘Closure of Account’ in person with a hard copy with the necessary documents. The closure form is available online which you can download so it’s not entirely offline either.
Please follow the following steps to close the Demat Account,
Please ensure that there are no shares or mutual funds or any other instrument present in the account
Make sure their account does not have a negative balance. To know the details of your account, check it by logging in to your account or contact your registered branch.
Download the Account Closure Form from your Broker’s website
Deactivating the Demat Account:
First, fill the downloaded Account Closure Form. If the account is being operated by more people; the account holders need to sign the closure form in front of the DP (Depository Participant) officer. Banks or Brokers can also be DPs.
Make sure you furnish the following details while submitting your closure form:
You will need to provide these details,
Customer ID and DP ID
Updated KYC details like name and address, these should match with the ones on your account.
Provide the reason for closing the Demat Account
A bank official must submit and verify the self-attested identity proof copy. This is mandatory.
Mandatory requirement – A Bank Officer needs to verify and submit the copies of identity proofs attested by you.
Submit the unused portion of the delivery instruction slip booklet back to the DP
Account Closure Form needs to be submitted to the nearest branch of your broker. The person whom the account belongs has to do it.
How to transfer remaining shares in the account?
Fill the account closure form
Use the DIS (Delivery Instruction Slip) to transfer the from one Demat account to another. The details like Name etc should be identical for the transfer to happen
From the Central Depository of the account in which the shares are to be transferred, submit the client master report with relevant stamp, signature and logo
Submit this form with other documents like DIS, CML and other docs to the broker’s office
Opening an account takes 10 minutes, since most of the process is automated but why is closing so cumbersome one might ask. The answer is when the new account is opened there are no shares in the account. When you close there might be so the physical procedure. So, there you go, now you have complete information for closing your Demat Account.