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What benefits do depositories provide?

April 26, 2017Benefits depositories

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What benefits do depositories provide?

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A5. Depositories provide a number of benefits like: Immediate transfer of securities; no stamp duty on transfer of securities; elimination of risks associated with physical certificates such as bad delivery , fake securities , etc.; reduction in paperwork involved in transfer of securities; reduction in transaction cost; nomination facility; changes in address recorded with DP gets registered electronically with all companies in which investor holds securities eliminating the need to correspond with each of them separately; transmission of securities is done by DP eliminating correspondence with companies; convenient method of consolidation of folios/accounts; holding investments in equity, debt instruments and Government securities in a single account; automatic credit into demat account, of shares, arising out of split/consolidation/merger etc. Q6. What facilities do depositories provide? A6. Depositories provide a number of facilities like: • dematerialisation i.e., converting physi