In this digital world, it is much advisable to have shared online as it comes in handy. Also, the process of converting physical shares is complex. If you still have a physical share, now is the time to convert them to Demat. The full process of stock conversion takes two to three weeks.
Procedure to Convert Physical Shares into the Demat Form:
Open a Demat Account with a DP
At first, you must open a Demat account with the depository participant (DP). A depository participant (DP) is a SEBI-registered entity that acts as a broker or middleman between you and the depository or bank. Your bank may also undertake the tasks and functions of a DP occasionally. It’s important to double-check that the names on your Demat account match the names on your physical share certificates.
Submit the Dematerialisation Request Form (DRF)
After filling the Demat account opening form, you must complete a DRF form as a shareholder. While filing your DRF form, make sure you surrender all of your physical share certificates to the DP. Before submitting a physical share certificate for verification, make sure to mark ‘Surrendered for dematerialization’ on it.
After document submission, the DP sends an electronic message to your issuer’s or bank’s Registrar or Share Transfer Agent. The responsibility for keeping your records has been delegated to R&T representatives.
Generation of Dematerialisation Registration Number
In addition, a dematerialization registration number is generated, which is linked to your DRF form and transmitted to the R&T agent along with the original share certificates you provide to the DP.
Authorization and Validation
Against the physical share certificates or papers that you submit, the Registrar and transfer agent conduct authentication and validation activities.
Name Change Initiation
The process of replacing your name with DP’s name begins. In addition, the number of shares that are submitted for dematerialization is recorded in the registrar’s business books. This depository stores information about a company’s shareholders.
The R&T generates an acknowledgment receipt and sends it to DP after the dematerialization process is complete, informing them of the changes made.
Finally, the DP credits the investor’s depository account with his or her dematerialized shares.
Many investors believe that changing physical shares to Demat form is time-consuming and cumbersome, which is completely wrong. The process is much simpler and can be finished in two to three weeks by shareholders. It is quite simple for shareholders to conduct intra-day trading with full peace of mind once the shares have been dematerialized. The Demat account also safeguards investors against the loss of actual shares.
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