Different Types of Demat Account
A Demat account is a type of repository for your shareholdings, primarily used to electronically hold shares, bonds, securities, ETFs, etc. It eliminates the hassles of owning and storing a physical copy of investments. The Securities and Exchanges Board of India (SEBI) mandates stock market investors to have a Demat account to invest. Indirect investments, such as purchasing a mutual fund, can be done without a Demat account; however, no direct investments can be made without it. Different types of Demat accounts are available in the market, and investors can select their preferred account according to their requirements.
Conclusion
A Demat account is a type of savings account that contains your securities instead of money. Investing in Indian stock markets requires a Demat Account, and the investors have the option to select from different types of Demat accounts. Residents of India can opt for a Regular Demat account which is relatively simple to procure from any Depository Participant. On the other hand, NRI investors have to comply with the rules of the Foreign Exchange Management Act (FEMA) and can hold a Repatriable or Non-Repatriable Demat account, depending upon their requirements.