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NISM Certifications · NISM-Series-VI: Depository Operations · Investor Services (NISM VI)

A BO's demat account was marked 'suspended for debit' by the DP after a regulatory order. Which of the following will still be possible in the account?

With a debit suspension, outgoing transactions such as sales, off-market transfers and pledges are blocked, but credits from settlement or corporate actions can still arrive unless a credit freeze is also applied. So only receiving credits remains possible.

  1. ACredit of shares from a purchase settlement or a corporate action may still be received unless the account is also frozen for creditCorrect
  2. BDebit by way of sale instructions through the broker
  3. COff-market transfer to a family member's account
  4. DPledge creation in favour of a lender

Explanation

A debit freeze blocks outgoing movements such as sales, transfers and pledge creation, but credits can still be received unless a credit freeze is also placed. Hence only the credit option remains possible. The other three involve debits from the account.

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