How to Open Demat Account in Online: A Step-by-Step Guide for Indian Investors
In this technologically advanced era, investing in stock market has become much more accessible. Whether its a beginner looking to invest long term in blue-chip stocks or a experienced trader searching for convenience, getting a grasp of how to open demat account in online is the first step towards diving into the world of indian investing.
This comprehensive guide will guide you regarding everything you need to learn when it comes to what is a demat account, the different types of demat account and the exact process of opening one online.
what is demat account, Really?
Before we go ahead and open one, let’s get the basics clear.
A demat account is kind of like a digital locker. But instead of keeping gold or cash, it stores your shares, mutual funds, bonds, and other investments—all in electronic form. So, no more paper certificates or files lying around!
Imagine you purchased shares of a company. Earlier, people got paper slips to prove ownership. But now, everything’s digital. And that’s exactly what a demat account does—it stores those shares online, safely under your name.
In India, there are two key entities that help keep track of all demat accounts:
- NSDL [National Securities Depository Limited]
- CDSL [Central Depository Services Limited]
These are like the digital vault managers. You don’t open your demat account with them directly. Instead, you open it through a broker or a bank, who ties up with these depositories.
Why Do You Need a Demat Account?
One cannot trade or invest in Indian shares on stock exchanges like NSE and BSE without having a demat account. It is mandatory for anyone looking to:
Buying or selling shares in the stock market
Invest in IPOs (Initial Public Offerings)
Hold mutual funds or ETFs electronically
Track and manage portfolios online
In short, if you want to grow your wealth through market investments, knowing how to open demat account is essential.
Types of Demat Account
When learning how to open demat account in online, one has to keep in mind which one suits the best for them based on the different types of demat account. In India the main types of demat account are as follows:
1. Regular Demat Account
This is the most popular one and is opened by Indian citizens who are residing in India and want to invest in bonds, equities, and mutual funds.
2. Repatriable Demat Account
This account is usually opened by NRI’s who’s goal is to transfer money abroad. For this the account must be linked with a Non- Resident External bank account.
3. Non-Repatriable Demat Account
Also for NRIs, but funds in this account cannot be transferred abroad. This type must be linked with an NRO (Non-Resident Ordinary) account.
4. Basic Services Demat Account (BSDA)
Meant for small investors. It comes with limited features but lower maintenance charges if the value of holdings is under ₹50,000.
Understanding the types of demat account ensures that one chooses the right one that matches their investor profile.
Documents Required to Open Demat Account Online
The online process is paperless and convenient, but you’ll still need to provide digital copies of some documents:
- PAN Card (Mandatory)
- Aadhaar Card (linked with mobile for OTP)
- Bank Account Statement or Cancelled Cheque
- Photograph (passport size)
- Signature on white paper
- Income proof (optional, but required for derivatives trading)
These documents are required by SEBI regulations for verification and compliance.
How to Open Demat Account in Online – Step-by-Step Process
Let’s understand the process on how to open demat account in online. One can chose from many stockbrokers or depository participants in India. Some of them are Zerodha, Upstox, Groww, ICICI Direct, HDFC Securities, and Angel one.
Step 1: Choose a Depository Participant (DP)
Research and select a broker or financial institution that offers demat account services. Compare their:
Brokerage charges
AMC (Annual Maintenance Charges)
Platform interface
Research tools
Customer service
Step 2: Visit the Official Website or App
Once you’ve picked a DP, visit their website or download their trading app. Click on ‘Open Demat Account’ or a similar option.
Step 3: Fill Out the Application Form
Provide basic details such as:
Name
Mobile number
Email ID
PAN number
Bank account details
An OTP will be sent to your Aadhaar-linked mobile number for verification.
Step 4: Upload Documents
Upload scanned copies or pictures of:
PAN Card
Aadhaar Card
Photograph
Signature
Bank proof
One should upload clear images to avoid delays.
Step 5: In-Person Verification
Some brokers require In-Person Verification via a live selfie or a short video recording. This is done through your smartphone or webcam and is mandatory as per SEBI norms.
Step 6: E-sign via Aadhaar
The final part involves digitally signing your application using Aadhaar e-sign, which requires OTP authentication.
Step 7: Confirmation & Account Activation
Upon successful verification, the demat account number and login credentials will be sent via email/SMS. This process usually takes less than 24–48 hours.
Benefits of Opening Demat Account Online
Convenience: Entire process can be completed from home
Speed: Account activation within hours
Paperless: No need for physical forms or in-person visits
User-friendly platforms: Mobile apps make trading easy for all users
These benefits make the online route ideal for today’s tech-savvy investors.
Cost of Opening and Maintaining a Demat Account
Different brokers have different pricing models. While some offer zero account opening charges, others may charge nominal fees. Here’s a quick cost breakdown to oen should be aware of:
Account Opening Fee: ₹0 – ₹300 [depending on broker]
Annual Maintenance Charges (AMC): ₹0 – ₹600 per year
Transaction Charges: Charged per sell transaction
Dematerialisation Charges: For converting physical shares (if any)
Choosing a discount broker can significantly reduce these charges.
Things to Consider Before Opening a Demat Account
Reputation of the broker
Mobile and web platform usability
Hidden charges or AMC fees
Availability of research reports and market data
Ease of customer support and grievance handling
Do your due diligence to avoid future complications and ensure a smooth trading experience.
Conclusion
Demat account provides a gateway for an individual to participate in the Indian stock markets. Advancements in digital onboarding has made it extremely smooth, efficient and quick to begin investing.
Whether one is a salaried employee, a retiree, a homemaker or a student, learning how to open demat account in online equips a individual with the tools to manage and grow the financial portfolio efficiently. One should be careful while choosing the broker so that they end up with the right broker, understand the types of demat account, and begin investing based on research oriented risk management.
Begin your journey today by deciding the right platform for yourself and getting your demat account activated in minutes.
Also Read : 7 Steps to Do Fundamental Analysis of Stocks
Also Read : Why Do You Need Mentor Support in Stock Market
FAQ'S
Can I open a demat account without a trading account?
Absolutely. One can any open any number of demat accounts with different brokers but not with the same broker using one’s PAN
What is Demat account?
A Demat account is a digital account used to hold shares and securities in electronic form. It eliminates the need for physical share certificates and simplifies trading and investing.
Can I have multiple demat accounts?
Absolutely. One can any open any number of demat accounts with different brokers but not with the same broker using one’s PAN
Is Aadhaar compulsory for opening a demat account online?
Yes, Aadhaar is mandatory since it is required for e-KYC verification and digital signature.
What documents are required to open Demat account?
To open a Demat account, you typically need:
- PAN card
- Aadhaar card
- Bank proof (cancelled cheque or statement)
- A passport-size photo
- Signature on white paper
