aims and objectives informative report of demat account

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Project informative report of DEMAT account

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In India, stocks and securities are held electronically in a dematerialized account (or "Demat"), rather than the investor taking physical possession of certificates. A Demat account is opened by the investor while registering with an investment broker (or a sub-broker). The dematerialized account number is quoted for all transactions that allow the electronic settlement of transactions. Each shareholder will have a dematerialized account for the purpose of transacting. Access to the dematerialized account requires an Internet password and a transaction password. Transfer or purchase of securities can then commence. Purchases and sales of securities in the dematerialized account are made automatically once the transactions have been confirmed and completed. The Demat account is like an account in a bank. All money used in stock is taken from this account.


India adopted the Demat System for electronic storage, where stocks and securities are represented and maintained electronically, eliminating the problems associated with paper stock. After the introduction of the deposit system by the Depositary Law of 1996, the process of sales, purchases and transfers of shares became much easier and most of the risks associated with paper certificates were mitigated.
In 1996, trading began in NSE for shares in the form of demat account. It was the beginning of a new paperless stock market environment. If an investor buys a stock today, it is credited to the investor's account in two days. Nowadays, the shares are transferred to the demat account of the investor.