Banking Term: DEMAT (Dematerialisation)
Find important banking term that is useful in upcoming banking exam.
Dematerialisation is a process by which the paper certificates of an investor are taken by the company/registrar and actually destroyed and an equivalent number of securities are credited in electronic holding of that investor.
The depository works as an aid to dematerialise securities and eliminate paper from the market.
Dematerialized account is opened by the investor while registering with an investment broker
Benefits of DEMAT Account
- Easy and convenient way to hold securities
- Immediate transfer of securities
- No Stamp on transfer of securities
- Reduced transaction cost
- A Single Demat account can hold investments in both equity and debt instruments.