Benefits of a Depository System
To the Investors
i) It eliminates bad deliveries of securities.
ii) The settlement cycle has become quicker. It is now T + 1.
iii) Immediate transfer and registration of securities are possible now.
iv) It eliminates the risks present in physical certificate for e.g. forgery, delays, mutilation, theft and damage of share certificates.
v) Electronic transfer of securities enables the investor to get dividend, bonus shares and right shares quickly.
vi) Transaction costs are lower as transfer of securities in electronic form is exempt from stamp duty;
vii) Further, at it is paperless trading, no share certificate and share transfer deed is required.
viii) Lastly, rate of interest on loan against the pledged demat shares are lower in comparison to physical shares.
To the Investors
i) It eliminates bad deliveries of securities.
ii) The settlement cycle has become quicker. It is now T + 1.
iii) Immediate transfer and registration of securities are possible now.
iv) It eliminates the risks present in physical certificate for e.g. forgery, delays, mutilation, theft and damage of share certificates.
v) Electronic transfer of securities enables the investor to get dividend, bonus shares and right shares quickly.
vi) Transaction costs are lower as transfer of securities in electronic form is exempt from stamp duty;
vii) Further, at it is paperless trading, no share certificate and share transfer deed is required.
viii) Lastly, rate of interest on loan against the pledged demat shares are lower in comparison to physical shares.
No comments:
Post a Comment