In an effort to encourage investor engagement, capital market regulator Sebi increased the cap on basic demat accounts by five times, to Rs 10 lakh, on Friday.
Sebi Boosts Small Investor Participation Raises
In an effort to boost investor engagement, capital market regulator Sebi on Friday raised the minimum amount required for basic service demat accounts by five times, to Rs 10 lakh from the previous Rs 2 lakh. The revised guidelines, according to a circular from Sebi, will go into effect on September 1. A more basic version of a conventional demat account, known as a basic services demat account, or BSDA, was launched by the regulator back in 2012 to lessen the cost of demat fees to investors with modest holdings.
Here are five crucial details regarding this story to be aware of: What does this threshold represent? It is an upper limit that applies to demat accounts with basic services that determines the highest value of securities an account can store.
What takes place on September 1st?, Sebi Boosts Small Investor Participation Raises
BSDA holders would be permitted to hold securities in demat form worth up to Rs 10 lakh, as opposed to a maximum of Rs 2 lakh.
What will the basic services demat account’s higher threshold accomplish?
It is anticipated that this action will encourage Dalal Street retail activity, particularly from small investors.
Stated differently, the action taken by Sebi is expected to stimulate stock market trading among individual investors.
A basic services demat account can be opened by whom? A basic services demat account can only be opened and maintained by people who satisfy specific requirements. Among these prerequisites are:
The investor is limited to maintaining a single demat account as the primary holder.
The investor is limited to having a single account of this type with several depositories.
Securities, both debt and non-debt combined, should not be worth more than the cap (Rs 10 lakh as of September 1).
One-time upkeep charge
According to the circular, portfolios valued up to Rs 4 lakh would not be subject to annual maintenance fees; those valued up to Rs 10 lakh will, however, be subject to a fee of Rs 100.
What occurs if the portfolio gains more than Rs 10 lakh? The basic demat account is automatically transformed into a regular demat account if the portfolio size surpasses Rs 10 lakh.
Account opning link:
- Groww Account- https://app.groww.in/v3cO/kyrp1zph
- Kotak neo Account https://kotaksecurities.ref-r.com/c/i/32531/109103906
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