CDSL

 

Central Depository Services Limited(CDSL)

  What is CDSL?
 
CDSL full form is Central Depository Services Limited and is the second Indian securities depository institution. Founded in 1999, CDSL holds various securities like shares, bonds, etc., in an electronic format. Working for the Bombay Stock Exchange (BSE), CDSL is promoted by the State Bank of India, Bank of Baroda, Axis Bank, HDFC Bank, Union Bank of India, and Standard Chartered Bank.

 


Nearly 600 stockbrokers are associated with CDSL in different capacities. The primary focus of CDSL is to provide secure and reliable depository services.


How does CDSL Work?

Now that you know what is CDSL, let’s understand the working mechanism of this depository institution. The operating mechanism of CDSL is just like a bank. The difference is that while banks have money from depositors, CDSL has securities from investors in an electronic format.

However, you can’t directly approach CDSL and open an account. You have to do so with the help of a depository participant or DP.

What is a Depository Participant?

A depository participant is an intermediary between you, the investor and CDSL. In other words, a DP is an authorised agent of CDSL who acts as a link between the beneficial owner, the stock exchange and the issuing company. The beneficial owner is the person who uses the services of the DP.

What is a CDSL Demat Account?
 

CDSL Demat account is the account you hold with CDSL. For opening a CDSL Demat account, you need to visit a DP, the list of which can be found on CDSL’s website. Once you have selected the DP registered with CDSL, you need to submit your KYC documents including address proof and PAN Card along with the bank account details.

 


Upon successful verification, you will get your CDSL Demat account number and other related details. The CDSL Demat account will be not only useful for availing the services of CDSL but also aid trading in stocks and other securities. Demat accounts with CDSL have a 16-digit numeric character.


CDSL Charges

Any DP or business entity that wants to associate itself with CDSL needs to pay certain charges. They are of multiple kinds and are applicable to an entity depending on its type.


Advantages of CDSL
 
There are several advantages of holding securities with CDSL. Some of them are:

  • Since the shares are held in an electronic format, there is no risk of theft, loss or damage. These were some of the pertinent risks with physical certificates.
  • As an investor, you don’t need to worry about the genuineness of securities purchased. This greatly eliminates the risk of bad delivery.
  • As soon as the payment is made to the company, the securities are transferred to your account. You don’t need to wait for the registration process from the firm or its Registrar.
  • With the T+2 rolling settlement cycle, there’s a quick transfer of securities ensuring liquidity.
  • You don’t need to pay stamp duty during the transfer of securities in electronic format.
  • With the help of a single instruction, you can update all details with all the companies in which you have invested.
  • CDSL also sends a consolidated statement of all their holdings that enable investors to make an informed decision.
CDSL Disadvantages
 
CDSL has certain disadvantages too. Some are:
  • Multiple levels of regulatory frameworks involving depositories Act, regulations, etc., need to be followed.
  • Rural people who still hold physical certificates are unaware of the system.
  • The vulnerability of hacking leading to identity theft and monetary losses persists.
What is the CDSL TPIN and how do I use it to sell my stock holdings?
Watch this video walkthrough on setting up CDSL TPIN or check out the process below.

Due to a change in regulation by CDSL, if you are a non-POA customer, you’ll now have to use the CDSL TPIN and OTP instead of your Kite PIN and authorise the debit of securities from your demat account against a delivery sale transaction.

You would have received the CDSL TPIN to your registered mobile and email address (from edis@cdslindia.com) with CDSL. If you haven’t received it, you can click here to generate it.

With the CDSL TPIN, you can pre-authorise the sale of your stocks at the beginning of each trading day so that you don't have to do it each time you place a delivery sell order during the day.

How do I generate the CDSL TPIN required to authorise my CNC sell transactions?
You would have received the CDSL TPIN, a 6 digit code, as an SMS and e-mail directly from CDSL when your Demat account was opened. CDSL is the institution (depository) that holds your demat account.

What is the CDSL TPIN and how do I use it to sell my stock holdings?
Watch this video walkthrough on setting up CDSL TPIN or check out the process below.

Due to a change in regulation by CDSL, if you are a non-POA customer, you’ll now have to use the CDSL TPIN and OTP instead of your Kite PIN and authorise the debit of securities from your demat account against a delivery sale transaction.

You would have received the CDSL TPIN to your registered mobile and email address (from edis@cdslindia.com) with CDSL. If you haven’t received it, you can click here to generate it.

With the CDSL TPIN, you can pre-authorise the sale of your stocks at the beginning of each trading day so that you don't have to do it each time you place a delivery sell order during the day.




What is the CDSL TPIN and how do I use it to sell my stock holdings?
Watch this video walkthrough on setting up CDSL TPIN or check out the process below.

Due to a change in regulation by CDSL, if you are a non-POA customer, you’ll now have to use the CDSL TPIN and OTP instead of your Kite PIN and authorise the debit of securities from your demat account against a delivery sale transaction.

You would have received the CDSL TPIN to your registered mobile and email address (from edis@cdslindia.com) with CDSL. If you haven’t received it, you can click here to generate it.

With the CDSL TPIN, you can pre-authorise the sale of your stocks at the beginning of each trading day so that you don't have to do it each time you place a delivery sell order during the day.

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