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

Rohan, the sole holder of a demat account, dies. His wife Meera wishes to have the securities moved to her own demat account. What is this process of changing the name of the holder in the depository records after the death of a holder called?

The process is called transmission. It is the transfer of securities to a legal heir or surviving holder by operation of law on the death of a holder, as opposed to a voluntary transfer, a change in order of names, or a pledge.

  1. ATransmissionCorrect
  2. BTransposition
  3. CPledge
  4. DRematerialisation

Explanation

Transmission is the transfer of securities to the legal heir or survivor by operation of law, such as on death or insolvency of a holder. Transposition only changes the order of names of existing joint holders, and pledge creates a security interest without any change of ownership.

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