How to Transfer Shares From One Demat Account to Another

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How to Transfer Shares From One Demat Account to Another

When you buy and sell shares in the stock market, your Demat account is credited and debited respectively. Apart from these, you can also transfer shares from one Demat account to another.

Few common reasons which force traders to transfer their shares from one account to another are as follows

  • If you want to change your broker
  • when you need to merge your multiple Demat accounts into one,
  • when you want to break a single Demat account into multiple,
  • If you wish to shift from a full-service broker to a discount broker or vice versa.

Now, when you the reason, let’s understand the procedure to transfer shares.

The two Depositories of India that are authorized to hold the shares of the account holders are National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL).

  • Target Client Id: It is a 16 digit identification number assigned to you.
  • ISIN: It stands for International Securities Identification Number. Basically, it is a 12 digit code that assists in identifying securities such as stocks, equities, notes, bonds, debt, funds and more. Here you have to mention to individual shares with quantities and other details.
  • DP Name: Name of the stockbroker
  • Intra-depository transfer: If your existing brokers & new stockbroker (in which you want to transfer your shareholding) are associated with the same depository. This type of transfer is within the depository itself. So, It is known as intra-depository transfer or off-market transfer.
  • Inter-depository transfer: When you are existing broker and new broker are associated with the different depositories, this type of transfer known as Inter depository transfer.

The transfer of shares from one Demat account to another is carried out in two ways, either offline or by Online Transfer.

In an offline transfer of shares, the transfer may be an Intra-Depository Transfer or an Off-Market Transfer. For any of these, the account holder must have Debit Instruction Slip (DIS Booklet) offered by their Depository Participant (DP). However, this mode of transfer is a bit lengthy and there are a few things that you will need to keep ready in hand for a smooth transfer of shares.

  • Record the names of the shares you wish to be transferred. Make sure the shares need to be transferred along with their ISIN number. The ISIN is a 12-digit code required to identify various securities. It is essential to enter the correct ISIN number as the transactions will be processed based on it.
  • Further, the Target Client ID needs to be recorded. It is a 16-character code that includes the ID of the client and the ID of the DP.
  • Now, you need to select the mode of transfer, whether it is an Intra-Depository or an Off-Market. Be cautious when selecting this option.
  • The filled-in and signed DIS slip must be submitted to your existing broker and thereon collect the acknowledgment slip regarding your transfer.
  • Generally, it takes nearly 3-5 business days for the existing broker to transfer the shares from the old Demat account and for the new broker to receive the shares in the new account.

If you wish to go with the online transfer of shares, it can be easily done using CDSL. Follow the below steps:

  • Visit the CDSL website, and select the Register Online link.
  • Further, the Target Client ID needs to be recorded. It is a 16-character code that includes the ID of the client and the ID of the DP.
  • Fill in the form with the necessary details.
  • 4. Print the form and it will be transferred to the account holder's DP.
  • Once the DP completes the verification process of the form, a password will be sent to the account holder's email ID.
  • By using the password provided, the account holder can log in and begin transferring the required shares.

Conclusion

The online transfer is convenient and faster compared to the offline mode. However, both online and offline mode of transfer have their own mode of operation. You can select one based on your convenience and preference.