SEBI changes demat account rules to expand reach
12 December 2015
Markets regulator Securities and Exchange Board of India (Sebi) on Friday said all demat accounts would be considered as a basic services demat account (BSDA) unless the demat account holder specifically opts to continue with a regular demat account.
Sebi had, in August 2012, introduced the facility of `Basic Services Demat Account' (BSDA) with limited services for eligible individuals with the objective of achieving wider financial inclusion and to encourage holding of demat accounts.
Further, Sebi had advised depository participants (DPs) to provide an option to all the existing eligible individuals to convert their demat account into BSDA. So far, few demat accounts have actually been converted into BSDA during the last three years despite large number of demat accounts being eligible for conversion into BSDA, the regulator said.
In order to facilitate the eligible individuals to avail the benefits of BSDA, Sebi has now advised DPs to convert all such eligible demat accounts into BSDA unless such beneficial owners specifically opt to continue to avail the facility of a regular demat account.
Accordingly, DPs will assess the eligibility of the beneficiary owners at the end of the current billing cycle and convert eligible demat accounts into BSDA.
Sebi has asked depositories to make amendments to the relevant bye-laws, rules and regulations for the implementation of the decision.