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

A DP receives an application to open a demat account for a minor, Aarav, aged 10, through his mother as natural guardian. Which is correct?

A minor's demat account is opened in the minor's sole name, with the natural or legal guardian signing and operating it. It cannot be held jointly with the guardian or another person, and the minor cannot operate it until attaining majority.

  1. AThe minor's account can be operated by the minor after age 10
  2. BThe account is opened in the minor's name with the guardian's details, the guardian operates it, and it cannot be a joint account with another holderCorrect
  3. CMinor accounts can be opened as joint accounts with the mother as second holder
  4. DThe guardian's PAN is not required, only the school certificate

Explanation

A minor's account is opened in the minor's sole name, represented by the guardian who operates it. Joint holding with the guardian is not permitted, and the minor's PAN along with the guardian's details and date-of-birth proof are needed.

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