Regular Demat Account
Indian citizens willing to trade in the stock markets are offered regular Demat accounts. Investors eager to trade in shares must open a regular Demat account from any SEBI registered broker. As investors purchase shares, they get digitally stored in the Demat account. Maintaining such accounts helps investors make quick transactions and transfer shares to other institutions. However, investors seeking to trade in futures and options are not required to hold a regular Demat account since these come with a specific expiry date. The depositories manage the functioning of a regular Demat account. However, it is the responsibility of the depository participants, also known as the stockbrokers, to manage the facilities, such as account opening and maintenance.
Recently, the Securities and Exchange Board of India (SEBI) launched a new Demat account known as Basic Services Demat Account (BSDA). The functionality of a BSDA is no different from a regular Demat account but comes with lower account maintenance charges. The BSDA was introduced for financial inclusion and to support investors seeking to invest in the financial markets.
Key Features of NRI Repatriable Demat Account
Here is a list of the critical features of NRI repatriable Demat accounts:
- NRIs can use repatriable Demat accounts while seeking to invest in financial assets or IPOs on a repatriable basis.
- NRI investors must link their NRE bank accounts with the NRI Repatriable Demat account.
- The NRI repatriable Demat account helps investors transfer investment profits and income from selling securities, overseas.
- The NRI repatriable Demat account allows for repatriation of up to USD 1 million during one calendar year.
Conclusion
Investors must hold Demat accounts to trade in the Indian stock markets. Various Demat accounts serve diverse investor requirements. Investors holding Indian citizenship can open a regular Demat account. In addition, NRIs can open repatriable or non-repatriable Demat accounts. NRIs seeking to trade in Indian securities can transfer funds overseas using NRI repatriable Demat account. NRIs also have the flexibility to transfer funds from their NRO to NRE accounts after paying applicable taxes.