State Bank of India (SBI) Demat account is the account that holds all shares of account holders in electronic or dematerialized form, informed country’s largest lender on its official account.
SBI’s Demat account holds the certificates of financial instruments like shares, bonds, government securities, mutual funds, and exchange-traded funds (ETFs).
According to SBI, the Demat account enables converting physical share certificates into electronic balances. Also, it facilitates delivery/receipt of electronic balances consequent to market / off-market trades, further said SBI on its official website.
Stock trading involves 3 different accounts:
- Trading Account
- Bank Account
- Demat Account
Trading in SBI Demat Account
SBI Demat Account holds securities in the digital form. It works like a bank account. As the bank account holds money, the Demat account holds securities. The securities such as Shares, Mutual Funds, and shares allocated through IPO, etc.
They credit the shares into the Demat account every time the customer buys new securities and is debited when they sell it.
The central depositories (CDSL and NSDL) manage the Demat account. The broker like SBI only acts as an intermediary between you and the central depository.
You can use SBI Trading Account for stock trading (buying and selling of the shares). Customer place orders for buy or sell equity shares in trading account online or over the call.
SBI Bank Account is for credit/debit of money for transactions done in the trading account. When the customer buys the share, it withdraws the money from the bank account. When the customer sells the shares, it credits the money received in the SBI Bank account.
Trading is done in Trading Account. The Demat and Bank accounts provide shares and money needed.
How to open a Demat and trading account in SBI?
There are 3 ways in which you can open a Demat and trading account in SBI as mentioned below:
- Visit the local SBI branch and open the accounts there.
- Fill the online application form available at SBI website.
- Contact the customer care and they will help to open your Demat & trading account.
It requires the photocopy of the following documents to open your Demat and trading account at SBI:
- PAN CARD
- Aadhar Card (for address proof)
- One passport-size photo
- Existing SBI saving account passbook (optional)
If you remember your SBI account number and its IFSC code, then the SBI saving account passbook photocopy is not required. You just have to fill your savings account details in the account opening form. However, it’s good to keep the photocopy, just in case.
SBI Cap Securities is a very reputed brokerage firm that carries out all the transactions in a very efficient and transparent manner. The fees, costs and even the brokerage charges are very rational and you end up sharing only a small margin of your profits as fees. This leaves you richer and makes the experience of trading a very rewarding one.
Opening an SBI Demat account is indeed a very good idea. Whether you are an experienced trader or you are a novice in the world of stocks and shares, opening a Demat account with SBI Cap Securities will prove to be beneficial for you. It is very simple to open the account as well since you can complete the entire process online. Of course, if you are a traditional investor who isn’t comfortable with the online process, you have the option of visiting a branch and getting it done physically too.
SBI Demat accounts provide you with many beneficial advantages and you are assured of good trading experience, given the markets benefit you. So log on to the official website of SBI Cap Securities and start exploring.
However, you must always tread carefully when you trade. It is your hard-earned money and even while the fund managers are highly skilled, your personal monitoring can make a huge difference.
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