MEANING AND NEED OF DEMATERIALISATION
MEANING AND NEED OF DEMATERIALISATION
It means to cancel the material in physical form. Dematerialisation is a process where the securities hold by the investors in physical form are canceled and the investor gives an electronic number so that he or she can hold the securities as a balance in the Demat account.
Demat or dematerialisation accounts were first introduced in India in 1996 by National Stock Exchange (NSE).
Why Dematerialisation is needed?
• In previous times, if anyone purchase or sale of securities then share certificates are transferred in physical form.
• So, there are chances of theft, destroy, delay, and other problems of paperwork.
• To avoid these problems and to improve stock market dematerialisation took place.
• Now, If you want to buy or sell shares then there will be no paper work.
• A Demat account has been introduced to hold and transfer securities electronically.
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