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NISM Certifications · NISM-Series-VI: Depository Operations · Functions of Depository Participant - Transmission and Nomination

Mr. Sharma, the sole holder of a demat account, passes away. His son wants the securities moved into his own name. What is this process of changing the ownership of securities on the death of a holder called in depository operations?

The process is called transmission. It covers transfer of securities from the account of a deceased holder to the surviving holder or legal heir. It is different from transposition, which only changes the order of joint holders' names, and from rematerialisation.

  1. ATransposition
  2. BTransmissionCorrect
  3. CRematerialisation
  4. DPledge invocation

Explanation

Transmission is the process of transferring securities held in a deceased holder's account to the legal heir or survivor. Transposition is a different process: it is a change in the order of names among joint holders. Rematerialisation converts electronic holdings back to physical form, and pledge invocation relates to a lender enforcing security.

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