In this article, we will discuss about the major terms of stock market, which is known as NSDL and CDSL. These both terms have played a very crucial role in stock market. Here, we discuss about their roles and a question, which asking that is NSDL and CDSL approved DPs. Therefore, let us start with a small brief up about NSDL and CDSL:
NSDL is an abbreviation of National Securities Depositories Limited (NSDL). NSDL is one of the first central depositories in India, which has opened their head office in Mumbai. Trade is done here under The National Stock Exchange. NSDL handles most of the securities and would be converted in dematerialised form. If we talk about the NSDL facts for previous years then, on 31 March, 2010, the total amount in releasing certificates is approximately 702 Crores. The NSDL had Demat more than 75% shares of 2670 Indian companies as of 2010 and the average of opening account on daily basis is 3646 since 1996. In present, 80% holders in all cities of India are holders of NSDL Demat account. The NSDL depository is operating on a daily basis except Sunday during working hours. NSDL declares the working hours in beginning of the calendar year in advance. If any individual want to trade in capital market, then he has to join NSDL, and are required to fill up Form number “E” and submit it to their Depositories Participants. He has also been required to submit the copy of history of their business of last three years, show the audited accounts (certified by the Chartered Accountant) and copies of annual reports of their business for the last 3 years.
CDSL is an abbreviation of Central Depository Securities Limited (CDSL). It was established in 1956 under the Company Act. CDSL transforms the physical share into electronic form, which implies that it got converted into Dematerialisation form. It is also such intermediaries among Depository participants and registrar of companies for dematerialisation of shares. CDSL did their trading under the Bombay Stock Exchange. It recruits the participants as agents of depositories under the Depositories Act. They offer their internet services and the trade name of their services is Electronic Access to Securities Information (EASI), which provides the services to enquire about the Demat account details, transactions detail and others on time to time. The EASI services can be used only by DP/RTA and it is not transferable in any circumstances or in any condition.
Well, after discussing about NSDL and CDSL, now we will discuss about the question, Is NSDL and CDSL approved DPs? The Depository participants should be registered under Depositories and the registration has been done in the form of contract in among both parties. However, before becoming an agent of DP, the participants should also be registered with SEBI. Before getting registration certificate, participants cannot be considered as proper Depository Participants. Banks, Public Financial Institutions, Foreign banks in India (which is approved by Reserve Bank of India), custodians, clearing corporations, stock brokers, Non Banking Financial Institutions and Share Transfer Agent can be registered as Depository Participants. As per 2008 analytics, 711 DPs are registered under the SEBI. The 266 DPs are registered under NSDL and 445 DPs are registered under CDSL.
Depository Participants, which are registered under NSDL, are such as:
1. Axis Bank
2. Dalmia Securities
3. DBS Bank
4. HDFC Bank
5. ICICI Bank
6. Globe Capital Market
7. Kotak Mahindra Bank
8. Religare Securities
10. SMC Global Securities
Depository Participants, which are registered under CDSL, are such as:
1. Axis Bank
2. Bank of India
3. Emkay Global Financial Services
4. J M Financial Services
5. Reliance Securities
7. SMC Global Securities
8. Sunidhi Securities and Finance
9. Motilal Oswal Securities
10. Karvy Stock Broking