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NISM Certifications · NISM-Series-VI: Depository Operations · Special Services - Debt Instruments and Government Securities

A retail investor in Pune wants to hold Government Securities (G-Secs) in electronic form through her existing demat account. Which statement about holding G-Secs in a demat account is correct?

G-Secs held in a demat account are maintained as electronic book entries with the depository through a DP, so no physical certificate is issued. Retail investors are allowed to hold them this way, and no separate depository is required.

  1. AG-Secs can be held in demat form only by institutional investors
  2. BG-Secs held in demat form are tracked as book entries in the depository account, so no physical certificate is issuedCorrect
  3. CG-Secs in demat form require a separate depository for each security
  4. DG-Secs can be held only in a Subsidiary General Ledger account and never in a demat account

Explanation

Retail investors can hold G-Secs in demat accounts with a depository through a DP. Holdings are maintained as electronic book entries, so no physical certificate is needed. The other options wrongly restrict eligibility or require separate arrangements.

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