What is DP in demat account?
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- Updated On:26-May-2021
- Replies:1
Short Answer
DP means Depository Participant and they act as go-betweens for the depository and the traders. It is the first 8 digits of the Demat account number. For more details, you can read through the expanded version.
Detailed Answer
What is a Demat account?
- Demat account is the short of dematerialised account.
- A Demat Account functions similarly to a bank account for your electronic share certificates and other assets.
- By opening a Demat you can hold bonds, mutual funds, government securities, shares, etc.
- It is a completely online platform, and no paperwork is involved.
- It helps the users to trade easily in that specific platform.
- Demat services are provided by two depositories in India: NSDL and CDSL.
- There are a lot of perks for having a Demat account such as: settlements will be smooth, help you to gain monetization and liquidity, and most importantly it will be safe and secure.
What is DP?
- It expands to Depository participant.
- They are the depository's agents, such as NSDL or CDSL.
- When you open a Demat account, you will be given a unique Demat account number, and a 16-digit number is assigned to you. Therefore, DP ID is the first eight characters, and your Client ID is the last eight digits.
- You can invest and trade in the capital sector using this one-of-a-kind code.
- A DP is also known as an Agent of the Depository in some cases.
- The provisions of the Depositories Act, 1996 control and monitor the connection between the DP and the depository.
- Brokerage firms, financial companies, and banks are the most common Depository Members, acting as a link between traders and stock markets.
- The Depository ID (DP ID) is the number assigned to the depository participant member, i.e., the person that manages your Demat account.
- A depository investor provides a variety of services, including stock commitment and unpledged, investor relations management, and so on.
- The depository participant credits or debits the Demat account if a buy or sale transaction occurs.
- Some of the examples of depository participants are: Upstox, Zerodha, ICICI direct, Angel broking, etc.
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Discussion (0)
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