Dematerialisation/demat is the process of converting physical shares into electronic format. An investor who wants to dematerialise his shares needs to open a demat account with a Depository Participant (DP). Investor surrenders his physical shares and in turn gets electronic shares directly in his demat account.
Why do you need a demat?
- A retail investor can hold shares in physical form, but cannot trade. For trading (buy or sell) of shares, an investor has to have a demat account.
- Demat is safe and convenient as it reduces risk of holding shares in physical form, reduces paperwork, ensures immediate transfer and eliminates bad deliveries.
- It eliminates transit losses relating to benefits such as dividends, bonuses, stock split, rights as these are automatically transferred into demat.
- Any update with depository gets automatically registered with all companies in which investor holds securities eliminating the need to correspond with each of them separately.
The depository participant can dematerialize the physical shares only if you have submitted all the required documents. Most of the time your demat request will get rejected for any one of the following reason:
- When there is a change in face value.
- Change in companies name due to merger or for other reasons.
- Signature mismatch.
- Physical quantity of shares received by the agent is more than the quantity mentioned in the demat request form.
- On submission of fake certificates.
- If certificates received are reported as lost/stolen and a stop is recorded in computer master files.
- If a stop is recorded as per bank lien or court order.
- If ISIN in certificate does not relate to the one mentioned in DRF.
- When the demat account holder’s name doesn’t match the name mentioned in the physical share certificate.
We provide solution to all the above mentioned difficulties and we assure you that your dematerialisation request gets processed smoothly.
- Mismatch of signature: Sometimes companies deny transfer of shares due to mismatch of the signature of the transferor in the transfer deed and specimen signature available in company records.
- Mismatch of name: Sometimes companies deny transfer of shares due to mismatch of name. ie. the demat account holder’s name doesn’t match the name mentioned in the physical share certificate.
- Loss of share certificates: A shareholder may loss share certificates, hence, denying him from valuable possession of his investments. The shareholder has to get duplicate share certificates in his or her name from the company.
- Mutilated share certificates: Due to wear and tear of share certificates sometimes they get mutilated causing problem in share transfer.
- Lack of updated information: An investor has changed address, but the details are correspondingly not updated with the depository participant or the company, resulting in a mismatch with the shareholder’s database. In this case, the investor may lose benefits such as dividends, bonus, split shares, rights issues etc.
- Change in face value: The face value mentioned in the share certificate will not be same as the current face value. In that case new share certificates has to be got from the company.
- Change in company name: A company name may change due to merger or acquisition. In that case new share certificates has to be got from the company.
- Dematerialisation of physical share certificates of a deceased family member: Sometimes family members are left with physical share certificates held by the deceased. This requires lot of paper work and regular follow up.
Step by step procedure:
- Email the scanned copies of the physical share certificate.
- If you already have a demat account share the details of the same.
- If you have already applied for demat and got rejected , let us know the reason for rejection .
- Our team will review and get back to you within 3 working days.
- On mutual agreement of terms we will sort out the issue.
Note: The cost for each and every service varies and it purely depends on the current value of the share certificate.