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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Account Opening

A DP is opening a Basic Services Demat Account (BSDA) for Mr. Dinesh Pillai, who already holds a regular demat account with another DP. Which of the following is correct?

A BSDA can be opened only when the individual does not hold any other demat account as sole or first holder, and the DP takes a declaration to that effect. Existing regular account ownership disqualifies him.

  1. ABSDA is permitted since he may hold it with any DP regardless of other accounts
  2. BBSDA can be opened only if the individual has no other demat account in his name as a sole or first holder, and a declaration to that effect is takenCorrect
  3. CBSDA is only available to non-resident investors
  4. DBSDA may be opened only if the holdings exceed the prescribed value limit

Explanation

BSDA is meant for small investors who hold only one demat account in which they are the sole or first holder across depositories, and the DP obtains a declaration to that effect. Since Mr. Pillai already has a regular account, he does not satisfy this condition unless it is the only one. Value limits are caps on eligibility, not minimums.

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