There are some cases when you might want to transfer shares from one demat account to another, just like money is transferred from one bank account to another. A person might want to transfer shares from one demat to another in any of the following cases:
They are opting for another broker
Different brokers offer different features and benefits with their demat accounts. Some brokers may charge a smaller brokerage or may offer a better online trading platform than others. For these reasons and more, users often switch from one broker to another. This necessitates transferring their shares from their old demat account to the new one.
They hold multiple demat accounts
The user may hold multiple demat accounts and may now want to merge them into a single demat account, necessitating the transfer of shares.
In each case, the ownership of the shares remains under the same name and hence there is no transaction involved. However, the process still isn’t very simple and a user still needs to acquaint themselves with the procedure of how to transfer shares from one demat to another.
How to Transfer Shares from One Demat Account to Another
There are two ways of transferring shares from one demat to another:
- Manual or offline
In each case, in order to understand how to transfer shares from one demat to another, it is important to have a basic idea of the system that makes your shares available to you. The ownership of shares is registered with a central depository – either the CDSL or NDSL. All depository participants or DPs are registered with either one of these depositories. If both your old demat account and new demat account are registered with the same depository, it is called an intra-depository or off-market transfer and if they are registered with different depositories it would be called an inter-depository transfer. With this distinction in mind, we look at how to transfer shares from demat to another through the two modes mentioned earlier.
How to Transfer Shares from Demat to Another Manually
In the case of manual transfer of shares, a delivery instruction slip or DIS is needed to be filled whether the transfer is off-market/intra-depository transfer or inter-depository. The following steps need to be performed in this case:
- Fill in the names of the securities that are to be transferred along with their ISIN. ISIN or international securities identification number is a 12-digit code that uniquely identifies each security.
- Enter the client ID to which you want to transfer the shares. This is basically your new demat account.
- In the next step select whether it is to be an intra or inter depository transfer depending on which depository your old and new accounts are associated with.
- Sigh the DIS slip and give it to your current DP and collect an acknowledgment receipt.
That is all that there is to the manual transfer of shares.
How to Transfer Shares From One Demat to another Online
Online transfer of shares can be done easily by using a facility offered by CDSL known as EASIEST. EASIEST stands for Electronic Access to Securities Information and Execution of Secured Transaction. To avail of this facility, users first need to register on the CDSL website.
- Log on to the CDSL website www.cdslindia.com and click on Register Online. Next, select the EASIEST option from the menu.
- Enter the details such as the DP ID ( the ID of your broker), your BO ID ( Beneficial Owner, which is the demat account holder), etc.
- Enter your email ID and phone number. You will receive a one-time password (OTP) on your registered mobile number.
- Enter the OTP in the box provided. Once your mobile number Is verified, your registration will be completed within 24-48 hours and you can transfer shares from demat to another online.
Why Transfer Shares from One Demat Account to Another?
The most common reason people transfer their shares from one demat to another is that they are looking for a better broker. It is always advisable to perform due diligence before opening a demat account with a demat account. Make sure you check for the following benefits offered by your broker:
- Low brokerage
- Ease of transaction
- Fast and easy to use user interface for online trading
- Safe and secure mobile app
- Value-added services
Having a good broker can make all the difference in online trading. You can open a hassle-free demat account for online trading with Angel One that offers a host of features and charges low brokerage.