Process of Making your own Demat Account.
                     Process of making your own Demat Account
Demat account
• A demat account is, in a way, like a bank account. Just as you 
hold your cash balances in your bank account, you hold equity 
shares and other securities in your demat account. In the past 
shares were held in physical form. Once these physical shares 
are dematerialized, they can be held in a demat account. 
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How to open a demat account?
• To open a demat account you must approach your Depository 
Participant (DP). The DP could be your broker or a bank. 
While you will open your demat account with the DP, the 
actual shares will be held in custody by one of the depositories 
(CDSL or NSDL). These are institutions sponsored by large 
institutions with government, which is safe and secure.
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Depository Participant
• The list of DPs is available in the websites of depositories. 
Next, along with the account opening form, you must enclose 
photocopies of some documents for proof of identity and proof 
of address. You will have to sign an agreement with DP in the 
depository prescribed standard format.
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KYC Documents
• The next step is to submit your KYC (Know your Client) 
documents. Along with filling the Account Opening form and 
filling all the details, you will also be required to submit copies 
of your PAN card. Additionaly, you need to furnish one proof of 
identity and one proof of your current residential address. The 
KYC form has the DP-Investor agreement.
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Agreement
• The DP-Investor agreement which lays out the rules and 
regulations and your rights and obligations. Do read the fine 
print in detail, which gives details of rights and duties of 
investor and DP. You are entitled to receive a copy of the 
agreement and schedule of charges for future reference.
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In-person verification
• At the third stage, most DPs will insist on an in-person-
verification (IVP). Either you can personally visit the centre or 
the representative will visit your place. Some brokers permit 
IVP over the web cam, although most brokers still insist on 
IVP. Proof of identity and address provided should exactly 
match with the details provided in the account opening form.
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Beneficiary ID
• The last step is the allocation of the Beneficiary ID (demat 
account number) once all the documents are in place and 
verified. The DP ID and the Beneficiary ID combined becomes 
your unique DP code for all future transactions. Demat account 
can only hold shares in custody and you still need a trading 
account with a broker to buy and sell shares.
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BO ID
• This is also called beneficial owner identification number (BO 
ID). All investments in securities will be credited to this 
account. If you sell your securities, your demat account will be 
debited. You can have multiple demat accounts if you so wish. 
You can choose your DP as per your convenience and there is 
no compulsion to open DP account with your stock broker.
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Points to remember
• Update your bank account details (bank account number, 
IFSC code) and postal address of your demat account 
when there is a change, as you will receive direct credit of 
refunds, dividends, interest, redemption payment and 
corporate correspondences like annual reports notice of 
AGMs as per the details mentioned in your demat account.
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