Documents Required For Demat Account

Opening a demat account and looking for the list of documents required for Demat account?

Here is the complete list of documents need to be submit to the stockbrokers while activating your account.

Since the demat account can be opened online these days, hence you only need to upload some of the essentials proof like income proof, identity proof, and address proof.

So without any further let’s dive into the details of documents necessary for opening a demat account.

 

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Documents Required For Demat Account Opening

If you are looking to start trading in the stock market,  there are few Documents Required For Demat Account.

Most of these documents are pretty standard in nature and thus, the overall process of account opening has become much simpler these days.

Depending on the kind of trader you are, the kind of trading segments you are looking to put your money into, there will be few requisites you need to take care of as far as documentation is concerned.

Let’s jump directly into the main crux of this article and see the list of the Documents Required For Demat Account:

1. PAN Card

PAN Card or Permanent Account Number is a mandatory document without which you cannot open your Demat account.

A self-attested copy of your PAN card is what is required as part of the overall documentation. It also needs to be made sure that your photograph displayed on the PAN card is easily visible.

There are a few deviations as far as the mandate of PAN card in Demat account opening is concerned including:

• Related to the income slab of the trader as per section 139A
• Traders residents of the Sikkim state
• Institutional clients such as FIIs, MFs, VCFs, FVCIs, Scheduled Commercial Banks, Multilateral and Bilateral Development Financial Institutions, State Industrial Development Corporations, etc.
• Transactions that are done on the behalf of the central or state government or by officials appointed by Indian Courts.

The PAN card can also work as the ID proof for you.

There are a lot of students who send out a query on whether they can open a Demat account.

Well, the answer to that is simple – own a PAN card, open a Demat account! It is one of those mandatory documents among the Documents Required For Demat Account.

Needs to be remembered!

2. Address Proof

You have multiple options in order to cater to this requirement.

At the same time, if your correspondence address is different from your permanent address, then you will be required to provide proofs for both (to some stockbrokers).

You may choose to provide any of the following documents as an address proof (as part of the Documents Required For Demat Account formality):

• Passport
• Driving license
• Ration Card
• Aadhaar Card
• Voter Id Card
• The first page of the Bank Passbook or Bank account statement (not more than 3 months old)
• Electricity bill (not more than 2 months old)
• Landline telephone bills (not more than 2 months old)
• Verified Rent agreement
• Gas Connection Copy
• Leave and license agreement/agreement of sale
• ID Card (with address details) issued by central or state government, PSU,
• ID Card (with address details) issued by Colleges affiliated to Universities (for students) or professional bodies such as ICWAI, ICAI, ICSI or bar council

Although you will be providing a signed copy of any of these documents, the broker executive might want to check the original document as well.

3. Income Proof

Traders looking to trade in derivatives (futures and options) or in commodities segment, as per the regulatory bodies of the Indian stock market, you are required to provide proof of income or net worth against your name.

The generic reason that could potentially be that the trader might have an inclination to use margin on his or her trading, which involves a reasonable level of risk.

Now, this income proof necessity of the Documents Required For Demat Account can be catered by either of the following mentioned documents:

• Form 16
• IT Acknowledgement copy
• Bank statement for the last 6 months
• Certificate issued by a verified Chartered accountant that confirms your net worth
• Stock Holding Statement

You must know that providing any of the above-mentioned documents is an essential requirement if you are looking to trade in the derivatives segment.

4. Canceled Cheque

You are required to provide an original canceled cheque that has visible information about:

• Your account number
• Bank Name
• IFSC/MICR code
• Account (Your) Name

This cheque helps to validate that the bank account you are linking with the trading account is a valid bank account and you are the same person who has opened the Demat account with the stockbroker.

5. Passport Photo

Depending on the type and number of accounts you are opening, you will be required to provide a specific number of recently clicked passport sized photographs.

Generally, the requirement could be in the range of 1 to 3 photographs.

Make sure that the photographs you provide are as recent as possible. These photographs will be affixed to the account opening forms and you will need to cross sign these photographs on the forms itself.

A photograph is certainly not a document but is one of the most important entities among the overall Documents Required For Demat Account.

6. A cheque for Account Opening and Annual Maintenance Charges

Different stockbrokers levy a different price on their Demat account opening and annual maintenance charges or AMC.

Check with the stockbroker you look to open your Demat account in order to understand their pricing on this.

You can check this detailed article on Demat Account Charges for further reference.

7. Initial Deposit Cheque

Depending on the initial trading deposit you are looking to put into your trading account, a corresponding signed cheque needs to be provided along with the rest of the documentation.

Make sure that the cheque you provide is in the name of the stockbroker and not in favor of any individual executive or sub-broker of the stockbroker.

Still, confused? Know about Demat Account rules and clear all of your doubts.

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Documents Required for Minor Demat Account

These days, financial security of the child is the priority of parents and thus most of them are looking for minor demat account.

With minor demat account, you can invest in equity shares for long term and to activate it all that is required is to open a demat account by submitting the documents mentioned below:

• PAN Card of the minor
• PAN Card of the guardian (natural or appointed)
• Aadhar Card of the minor
• Aadhar Card of the guardian
• Age Proof of the minor (Birth Certificate)
• Address Proof
• Photographs of the minor
• Photographs of the guardian

Make sure you have all the valid proof before you apply for activation of minor demat account with the reputed stockbroker.

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Documents Required for HUF Demat Account 

For Hindu Undivided Family here is the list of documents required for demat account opening:

• Copy of HUF PAN with clear seal and signature.
• Copy of HUF Bank Statement or Passbook for Address proof with clear seal and signature.
• Self-attested copy of Karta PAN card.
• Self-attested copy of Karta Address proof.
• Copy of Member PAN card or Coparcener.
• Personal cheque with the HUF name printed on it or bank passbook with full back account number, MICR and IFSC code.

In case you want to trade in derivatives, then here is the list of income proof need to be submitted. 

• Last 6 months bank statement
• ITR acknowledgement slip
• DP holding statement
• Net-worth certificate.

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Documents Required for Corporate Demat Account

In case you are looking to open a Corporate account, then the Documents Required For Demat Account might be a little different. Find the details here:

• Copy of the balance sheets of the company for the last 2 financial years. This is generally submitted every year.
• Copy of the Board Resolution for investment in securities market
• Shareholding pattern copies that include the complete list of stakeholders holding a stake in the company control directly or indirectly duly certified by the company secretary or the Whole-time Director or the Managing Director of the company. This also needs to be submitted every year.
• Passport-sized photograph along with details such as POI, POA, PAN and DIN numbers of whole-time directors/two directors looking over the company’s business operations.
• Passport-sized photograph along with details such as POI, POA, PAN of individual promoters holding control directly or indirectly in the company.
• Copies of the Memorandum and Articles of Association and certificate of incorporation
• Authorised signatures along with the signatories list in the company.

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Conclusion

Above is the list of documents required to open a demat account with any of the stockbroker in India.

But before  applying for account activation, make sure you comply with some of the important considerations while completing the documents required for Demat account:

• Your name as the account holder must be consistently spelled correctly across all the documentation you provide.
• None of the documentation is forged or edited as it will directly lead to a rejection of the Demat account application.
• If you are a minor (i.e. your age is less than 18 years), then one of your parents or guardians can open a Demat account for you. Although the account will be in the name of the minor but the guardian is required to sign the account opening form and provide personal and contact details.
• If you are an NRI and are looking to invest in the Indian exchanges, then you will need to provide the original power of attorney along with an approval letter from RBI that permits them to invest (PIS Permission letter).
• In case you are opening a joint Demat account, then the signatures of all the joint holders are required in the account opening form.

Once you have provided all the documentation and the stockbroker has accepted all the documents required for the Demat account, then the latter will provide an acknowledgment slip duly signed and stamped back to the former. You will get the following once all the formalities of account opening are complete:

• Client ID (length of the ID depends on the depository the stockbroker is registered with.
• DIS or Delivery Instruction Slips
• Copy of the final acknowledgment of the account opening report.

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Have all the documents ready with you? Why to wait more? Get in touch with us and open a demat account online for FREE without any further delay.

 

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