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

Mr. Reddy wants to close his demat account that holds no securities and has no pending dues. What is the correct procedure for the DP?

The BO submits a closure request in the prescribed form to the DP, which closes the account once dues are cleared and any holdings are transferred. A DP cannot demand a minimum balance or force a waiting period before closing.

  1. ARefuse closure until the BO holds a minimum balance
  2. BAccept a closure request in the prescribed form and close the account, after transferring any balance if presentCorrect
  3. CClose the account only after three years of inactivity
  4. DClosure is possible only through the depository directly

Explanation

A BO may close an account at any time by submitting the prescribed closure form to the DP, after settling dues and transferring or dematerialising any holdings. DPs cannot impose minimum balances or waiting periods.

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