Convert shares to demat form1 min read . Updated: 04 Feb 2019, 06:33 PM IST
- You can open a demat account with a bank, broking company or on an online platform
- To open the account you will have to provide your identity proof and do your KYC process
Deadline gets closer
Do your parents or grandparents have physical shares safely kept in the locker? They should know that the physical shares have to be converted into demat form before April 1. According to a Securities and Exchange Board of India (Sebi) circular, if the physical shares are not converted into demat form, then the physical shares cannot be transferred. “It had to have an end date. Physical shares are not accounted and Sebi has given enough time for investors to convert physical shares to dematerialised ones. I don’t think the physical shares are a significant number," said Nithin Kamath, co-founder and chief executive officer, Zerodha, an online broking company.
Converting to demat form
To begin with, you need to first open a demat account. You can open a demat account with a bank, broking company or on an online platform. To open the account you will have to provide your identity proof and do your knowyour-customer (KYC) process. Once you have opened a demat account, your next step is to convert the physical shares to a demat form. For this you will have to surrender the shares to a depository participant. This has to be done manually. You will have to fill a form to dematerialise the shares with details such as identity proof, account number, name, folio number and submit the form with your signature and send to registrar and share transfer agent.
How to track in demat form?
After you submit the form, you will get verification acknowledgement in 2-3 weeks. If verification is successful, you will get an electronic message of a transfer from physical form to demat form. Once the shares certificate gets accepted, the unit gets credited to your demat account. It will start reflecting in your demat account. You can now start transacting in the secondary market through the demat account. You can also transfer the shares outside the market. If you sell outside the market, you have to specify the transaction details. You have to send them to the depository participant. But remember that even if you hold the shares in physical form, after April 1 it will still be valid.