Demat transfer between two BOs in India across or within same depositaries

The Securities and Exchange Board of India (Sebi) has granted registration to two depositories -- the National Securities Depository Limited (NSDL) and the Central Depository Services (India) Limited (CDSL) under the Depository Act (1996). This provided the capital markets with superior technology, complex securities processing and rock solid accounting and portfolio management system.

NSDL charges a minimum fee of Rs 15 per debit transaction, which means the seller will have to pay Rs 15 for every deal, irrespective of the amount. In addition, NSDL also charges a Rs 0.75 custody fee per entry per month, equivalent to Rs 9 per year. CDSL has proposed to charge a fee of 0.01 per cent, subject to a minimum of Rs 5 and maximum of Rs 12, per debit deal. CDSL has also kept a Rs 100 monthly fee per depository participant or the actual bill for a month, which ever is higher. NSDL is still leading with around 80 per cent market share. CDSL charges less than NDSL. These charges, sometimes restrict small investor to opt for depository services.


What is an Inter Depository transfer?
Any transfer of securities between two BOs not having demat accounts with the same depository is termed as an "Inter Depository" transfer.


What are the transaction charges in respect of transfer of demat securities?
Transaction charges for each debit in a BO account is levied by CDSL and collected by DPs. DPs after adding their mark up, if any, fix a composite charge which is intimated by them to their clients.


What is an On Market and Off Market transaction?
a) Any transaction for sale and purchase of securities through a broker on the stock exchange to be settled through Clearing Corporation / Clearing House is generally termed as On Market transaction.
b) Off Market transaction is one which is settled directly between two BOs with or without using the broker and where no Clearing Corporation / Clearing House is involved.

At the time of opening demat account with X bank he must have given you a transaction slip book ( like a cheque book). Fill the details of your Y bank in that transaction slip and sign and hand it over to the X bank. If the signature is tallied then X bank will transfer all the shares listed in the transaction slip to your Y demat account. The ISIN nos required to fill in this slip are available in the Demat statement of X bank Demat account.The normal time period is 3 days.

Demat accounts are for crediting shares and other securities in non physical form i.e.electronic form. Suppose if you have 100 shares of a company you need not hold it in paper from, it will be credited to your demat accounts (dematerialisation). You can sell the shares by giving a debit instruction slip(like a cheque).

Is your demat account safe? Take care!
http://www.rediff.com/money/2006/may/08spec2.htm


BOs should take the following precautions with respect to instruction slips:-
a) Ensure that the DP issues Debit Instruction Slip (DIS) book.
b) Ensure that instruction slip numbers are pre-printed on each DIS.
c) Ensure that the demat account number is prestamped.
d) If only one entry is made in the DIS, strike out remaining space to prevent misuse.
e) All details like target account ID, quantity, ISIN, etc. to be furnished in the DIS should be filled in by BO himself.
f) Use separate DIS for confirming On Market / Off Market / Inter depository obligations / transfers and also for Delivery and Receipt Instructions.
g) In case of a Joint Account, all the account holders must sign the DIS
h) Submit the DIS in duplicate and obtain the DP's acknowledgment / receipt stamp on the copy of the DIS and retain the same in safe custody.
i) Keep the DIS book in proper custody under lock and key when not in use. In case of any loss / misplacement of DIS, the same should be intimated to the DP immediately.
j) Should never sign and keep a blank DIS.
k) All the holders must confirm any alteration, correction or cancellation made on the DIS with their signatures.