Mr. Z holds 50 shares of Peculiar Company Ltd. in physical mode and wishes to convert the same into electronic mode.(a) Mr. Z holds a Saving Bank Account with CFDH Bank Ltd. Can he deposit his shares into this account for demat?(b) What type of accou…

Answer: (a) No (b) A Demat (Beneficial Owner) account (c) No

(a) No. A savings bank account holds money, not securities. Shares cannot be deposited in it for dematerialisation.

(b) Mr. Z must open a Demat account (Beneficial Owner account) with a Depository Participant (DP), which may be a bank such as CFDH Bank if it is registered as a DP, or a stock broker. He then submits a Demat Request Form along with his share certificates to the DP.

(c) No. After demat, the shares are held in electronic form by a depository, i.e. NSDL or CDSL, through the DP. The RBI is the central bank and does not act as custodian of shares.