How can you convert your regular demat account to Basic Services Demat Account?

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How can you convert your regular demat account to Basic Services Demat Account?
A regular demat account that needs to be maintained for holding securities in electronic form entail a cost that is substantial enough. So, to promote the participation of small investors, SEBI has said effective October 1, 2012, individuals maintaining a single demat can either as a sole or pimary account holder and with securities of a value not over Rs. 2 lakh to get their account converted into Basic Services Demat Account (BSDA).

For the no-frills account, annual maintenance charges or AMC shall be charged on the slab basis. Further depending on the account i.e. whether it is with or without the Power of Attorney (POA) charges apply.

So, the BSDA account entails a lower cost, for holdings worth Rs. 50,000, AMC charges are nil. For, higher amounts upto Rs. 2,00,000, AMC charges for both the BSDA accounts with and without POA are Rs. 100. And , for higher holdings over Rs. 2,00,000, charges @ Rs. 450 and Rs. 500 are charged for the BSDA with and without POA respectively. Note the charges are inclusive of service tax.

In case on any day, if your holdings exceed Rs. 2,00,000 and you do not meet the eligibility criteria for maintaining the BSDA any longer, your account shall be converted into the regular demat account and entail usual charges. And in case you again fall in the category, request for the conversion of the account to BSDA account can be made once the AMC billing cycle ends.

Procedure to get your regular demat account converted into BSDA

For the conversion to happen, demataccount holder needs to submit the request letter or the declaration for the BSDA faciltiy before 15 days of the next billing cycle. Additionally, schedule of charges, is also to be submitted with the service branch of your depository participant.

Story first published: Thursday, March 6, 2014, 14:50 [IST]
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