How to Open a Demat Account Online in India: A Step-by-Step Guide

Getting started in the stock market begins with one essential step: opening a Demat account. It lets you hold shares and other securities digitally, making investing and trading simpler and more convenient. If you’re new to the process, understanding the documents, charges and account-opening steps can help you get started easily.

In this blog, learn how to open a Demat account online in India, step by step.

What is Demat Account and How Does it Work?

You can hold multiple securities in a Demat account, including:

• Equity: Shares or stocks of companies.
• Bonds and Debentures: Debt instruments issued by corporations and governments.
• Exchange-Traded Funds (ETFs): Funds traded on stock exchanges, offering diversification and flexibility by holding stocks, bonds, etc.
• Government Bonds: Debt securities issued by the government to fund spending.
• Mutual Funds: Investment programs funded by shareholders that trade in diversified holdings.

Who Can Open a Demat Account Online?

A Demat account can be opened by different types of investors, depending on their residency status and account structure. In India, eligible applicants generally include resident individuals, minors through a guardian, NRIs, HUFs, companies, LLPs, partnership firms, trusts and societies.

For individual online account opening, you typically need a valid PAN, Aadhaar-linked mobile number, bank details and other KYC documents. The exact process and documentation may vary depending on the type of applicant and the broker.

Benefits of Opening a Demat Account

Opening a Demat account makes investing and managing securities more convenient by holding them in digital form. Key benefits include:

• Easy access: View and manage your investments online from anywhere.
• Safer holdings: Reduces the risk of loss, theft, damage or forgery associated with physical certificates.
• Faster transactions: Makes buying, selling and transferring securities quicker and more efficient.
• Portfolio tracking: Monitor your holdings and changes in their value in one place.
• Automatic credits: Dividends, interest and refunds can be credited directly to your linked bank account.
• Multiple investments in one account: Hold shares, bonds, ETFs, mutual funds and other eligible securities digitally.

Opening a Demat Account: Key Charges to Consider

• Demat Account Opening Charges: When you open a Demat account, you’ll have to pay certain fees.These usually range from ₹200 to ₹3001.
  Shoonya’s account opening process is free.
• Trading Account Opening Charges: In addition to the Demat account, you’ll also need a trading account to make trades.
  Some of the brokers charge a fee for opening an online trading account.
• Annual Maintenance Charges (AMC): AMC is an annual fee you pay to maintain your Demat account. It covers administrative expenses and ensures your account runs smoothly.
• Brokerage Fees: Your broker charges brokerage fees for executing trades on your behalf.
  It can be a fixed amount per trade or a percentage of the transaction value.

How to Open a Demat Account on Shoonya?

To open a demat account on Shoonya, you can either download the Shoonya app from the Play Store/Apple Store, or you can directly visit PRISM.

Here are the steps to open demat account on Shoonya —

• Enter your mobile number and continue.

• Verify your mobile number with the OTP received on your phone.

• Enter your email address and then verify your email by entering the OTP received in your email.

• Now, you will be asked to enter additional details such as your occupation, annual income, trading experience, etc.

• Next, verify your documents with DigiLocker.

• Enter your Aadhaar card number, enter the captcha, and then click on Next.

• Enter the OTP received from Aadhaar and continue.

• Enter your DigiLocker security PIN and continue.

• Next, you must enter your personal details, such as marital status, father’s name and mother’s name.

• Now, you shall be asked to take a selfie. Allow the app to use the camera and follow the instructions.

• Add a signature from a file stored on your phone or draw one in the box provided and move ahead.

• Now, you must choose the trading segments you wish to activate — Equity, Mutual Funds, Derivatives, Commodity Derivatives (MCX). You can choose all.

• Now you have to verify your bank account by selecting one of the following: Verify with UPI, Add bank details manually, or Submit a cancelled cheque.
  For e.g., if verifying with UPI, ₹1 will be debited; supported apps include PhonePe, Paytm, Google Pay, Cred, etc.
  Click on your UPI app to allow auto-deduction, and once your bank details are fetched, confirm them or try again if required.

• Add a nominee for your safety before you proceed. You can do this later as well.

• Read and e-sign your account opening form.

• Scroll to the end on the next screen and enter your Aadhaar number. Click on ‘I agree to the terms and conditions’ and request an OTP.

• Validate the OTP to proceed.

• Your documents have been submitted for verification.

• Complete income verification if you have selected trading in F&O and commodities.

• Using an Account Aggregator, your bank statement will be fetched. You can also use the manual upload option for financial proof.

• Verify your mobile number with the OTP received on your phone.

• The process is complete. Your account will be opened shortly, and you will receive the credentials on your registered email ID.

Shoonya’s Offline Demat Account Opening Process

Below are the steps to open a demat account offline:

1. Determine the type of account you want to open (non-individual, minor, NRI, or joint account).

2. You can download the KYC form from our website (https://shoonya.com/download), or send a request to [email protected].

3. Once we get the request, you will receive KYC forms and a list of required documents for the demat account from Shoonya.

4. Next, please print out the forms, fill them, and sign them.

You need to send the filled and signed forms to the address:

Note: Offline account opening is only available for HUF, minor, corporate, LLP, partnership, and joint accounts.

Demat Account Opening Documents

Here is the list of documents required for opening a demat account:

• Proof of Identity (POI): You need to submit a valid photo identity proof, such as an Aadhaar card or PAN card.
• Proof of Address (POA): You need to submit a valid address proof, such as an Aadhaar card.
• Proof of Income: You must submit proof of income if you want to trade in derivatives, such as futures and options. You can submit one of these: the latest 6-month bank Statements, the latest ITR, the latest Form 16, the latest 3 months’ salary slips, the latest net-worth certificate, or the latest Demat holding statement.
• PAN Card: You must submit a copy of your PAN card, which is mandatory for opening a demat account online.

Also read — Types of demat accounts and the associated charges!

Difference Between a Demat Account and a Trading Account

A trading account helps you buy or sell, while a Demat account helps you hold your securities.

Difference Between a Depository and a Depository Participant (DP)

A depository holds securities electronically at the market-infrastructure level, while a Depository Participant (DP) acts as an intermediary through which investors access depository services.

Shoonya Demat Account | FAQs