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NISM Certifications · NISM-Series-VI: Depository Operations · Depository and its Business Partners

A company wants its securities to be held and transferred in electronic form through a depository. Which of the following business partners of the depository does the issuer typically appoint to handle the electronic connectivity for dematerialisation and corporate benefits on its behalf?

The issuer's Registrar and Transfer Agent, or its in-house share transfer agent, handles this role. Through an agreement with the depository, the RTA connects electronically to process demat and remat requests and corporate benefits. Brokers, custodians and clearing members have no such role for the issuer.

  1. AClearing member
  2. BRegistrar and Transfer Agent or the issuer's own share transfer agentCorrect
  3. CCustodian
  4. DStock broker

Explanation

The issuer enters into a tripartite agreement with the depository and its RTA (or in-house transfer agent) so that the electronic connectivity for demat requests and corporate benefits is established. Clearing members, custodians and brokers are not appointed by the issuer for this purpose.

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