There is a legal process that must be followed before a person may invest in the stock market. First, have your Aadhaar card linked to your Demat account. The Securities and Exchange Board of India (SEBI), the market regulator, mandated that all broker houses link their clients’ Aadhaar numbers to their Demat accounts. The National Securities Depositories Ltd. (NSDL) then gave investors plans to link Demat account with Aadhaar online.
There is no documentation needed for linking when done online. Having both an Aadhaar number and a Demat account is vital for a variety of reasons.
If you need to verify your identity or current residence in India, you can use your Aadhaar number which is a 12-digit number given by the Unique Identification Authority of India (UIDAI) of the Union Government.
The shares in a Demat account are held electronically rather than physically. A Demat account is required to participate in the stock market.
Papers you should have on hand when linking online
- Updated Aadhaar number
- PAN card
- Demat account number
- OTP that will be sent to your phone.
What do you mean by Demat Account?
Investing in physical equity shares is a time-consuming affair and you may also run the risk of getting counterfeit shares. A Demat account is vital for the safe and secure buying of shares. If you plan on doing any online trading, a Demat account will come in handy. You can store your stocks and securities in a digital, non-physical form. All physical share certificates are replaced with digital ones, making stocks more easily usable. To complete a trade using an online way of investing, having a Demat account number is a must. To buy the shares and keep them safe, investors can use a Demat account. It works just like a bank account in that money is deposited by the account holder with the bank, and a record of debit or credit balances is kept in a passbook. A person’s Demat account will be credited or debited when they buy or sell shares. It is possible to open a Demat account even if you do not own any shares, so long as you keep a zero balance in the account.
How to link Demat account with Aadhaar online?
One of the quickest ways to link Demat account with Aadhaar online is through the NSDL portal. These steps must be followed:
Step 1: Find the ‘Click here just to Link Aadhaar to Demat Account’ link on the NSDL portal.
Step 2: Click the ‘Get Started’ button on the NSDL Aadhaar linking portal (https://aadhaar.nsdl.com/AadhaarSeeding/).
Step 3: Enter the verification code and your DP Name, DP ID, Client ID, and PAN.
Step 4: NSDL will send a one-time password (OTP) to the user’s phone and email address.
Step 5: All other data about the Demat account will be shown. If all that you see on the screen is correct, you can move forward.
Step 6: Click on ‘Proceed’ after you have filled out your birth date and gender, and verify Aadhaar number.
Step 7: Aadhaar will then send an OTP to the user’s mobile device.
Step 8: Verify the details by entering the OTP number and clicking ‘Submit.’
Step 9: Demat account is thus linked to your Aadhaar card, and a message will be sent to your email and mobile phone.
Factors to consider before linking Demat account with Aadhaar
Before you link Demat account with Aadhaar, you need to keep in mind that:
- You can verify your identity with NSDL by linking your phone number and email ID.
- You can use OTP verification if your phone number is linked to your Aadhaar.
- Before you link the account, you will need to have your DP Name, DP ID, PAN, and other details.
- For security reasons, you should avoid entering sensitive data into Internet sites while using public or shared computers.
- The perks of connecting your Aadhaar number to your Demat account are many, so do not refrain from linking your Aadhaar to your Demat account.
Value of linking Demat account to Aadhaar
The perks of linking your Demat account and Aadhaar card are as follows:
- Demat accounts that have not been linked with Aadhar will be taken as fraud and closed quickly once the last date has passed.
- Since the Aadhaar number will be used to verify the account holder’s identity, filling out the e-KYC will be a quick thing after the Demat account has been linked with it.
- After Aadhaar is linked, investors have the choice to switch to any stock market brokerage firm they like.
- The system aids SEBI in keeping tabs on transactions and checking any attempts at fraud.
- The traders will know the entire process of investment, which will make it safer and easier to carry out transactions.
- More investors will enter the market as there will be an ease of trade and a higher volume of transactions.
- Less paperwork is needed for trading options, making future trading simpler for both new and old traders.
It is now easier than ever to link Demat account with Aadhaar and start trading in shares and stocks. It helps to avoid cancellation of your trading account and enjoy the perks of safe trading. Finding a reliable financial partner who can give you a user-friendly trading platform and up-to-date market reports is very crucial. If you are looking for more content like this, head over to Piramal Finance website. This online platform is what you need to learn everything about topics related to identity proof, banking, finance, and more. For more information on financial matters or about personal loans, credit cards, and financial management, check out the blogs on their website!