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NISM Certifications · NISM-Series-VI: Depository Operations · Depository and its Business Partners

Ms. Iyer wants to hold her shares in demat form and enquires which entities can act as Depository Participants of a depository in India. Which of the following is eligible, subject to SEBI registration and depository approval?

A bank, stock broker or financial institution that meets the eligibility criteria can act as a DP. These entities must be registered with SEBI and be admitted by a depository. Ordinary individuals or unrelated companies cannot become DPs merely by holding a PAN or being listed.

  1. AAny individual with a PAN card
  2. BA listed company that is not a financial intermediary
  3. CA bank, stock broker or financial institution meeting the eligibility criteriaCorrect
  4. DA foreign tourist agency

Explanation

Entities such as banks, financial institutions, SEBI-registered stock brokers and certain other eligible intermediaries can become DPs after meeting net worth and other criteria and obtaining registration. An individual holding a PAN or an unrelated company does not qualify.

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