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

Ravi Menon, a resident individual, wants to open a demat account with a Depository Participant (DP). Which statement about the account opening process is correct?

The DP must collect a duly filled account opening form and KYC documents and verify copies against originals. Accounts cannot be opened on verbal requests, need no prior securities purchase, and do not require depository approval for each individual account.

  1. AThe DP must obtain a duly filled account opening form and KYC documents, and verify the originals against the copies submittedCorrect
  2. BThe DP may open the account on a verbal request and collect documents within one year
  3. CThe DP can open the account only after the investor has bought securities
  4. DThe DP must obtain approval from the depository for every individual account before opening it

Explanation

A DP must take a completed account opening form with KYC documents and verify copies against originals (or use permitted e-KYC). Verbal requests are not valid, a prior purchase of securities is not required, and the depository does not approve each individual account before opening.

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