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

Ms. Kavita Rao holds shares in her demat account and wants to prevent any debit from the account for some time, while still allowing credits such as bonus shares and dividends-related corporate benefits. What facility should she request?

She should request a freeze on debits only. This stops securities from being debited from her account while still permitting credits such as bonus shares. A full freeze would also block credits, and closure or a BSDA conversion does not restrict transactions.

  1. AFreeze of debits only on the accountCorrect
  2. BClosure of the account
  3. CFreeze on both debits and credits
  4. DConversion of the account to a basic services demat account

Explanation

A BO can request a freeze that blocks only debits, leaving credits allowed. A total freeze would block credits too, which she does not want. Closure ends the account and a BSDA is a different category with charge benefits, not a restriction facility.

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