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

While opening a demat account for a resident individual, the DP must ensure that which of the following is obtained as a mandatory part of KYC?

The DP must collect the PAN of the account holder and verify it against the original document or through permitted electronic verification. PAN is a mandatory KYC element for demat account opening, whereas tax returns, bank guarantees or introducer letters are not required.

  1. AIncome tax return of the last three years
  2. BPAN of the account holder, verified against the original or through the permitted electronic verificationCorrect
  3. CA bank guarantee equal to annual maintenance charges
  4. DA recommendation letter from an existing account holder of the same DP

Explanation

PAN is mandatory for all holders (with limited exemptions such as Sikkim residents and certain government bodies), and the DP verifies it against the original or via the permitted electronic route. Tax returns, bank guarantees and recommendation letters are not required for KYC.

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