your demat account safe and secure is one of the most important aspects. After
all, your demat account is for your stock holdings and long-term assets. When
dealing with shares, both physically and electronically, you must comply to
basic security standards. We''re all familiar with the process of opening and
operating a demat account.
aspect of demat accounts which is known as the account''s freezing or unfreezing.
demat account freezing means?
account can be frozen in two ways. There is a regulatory freeze on your
demat account as well as a voluntary freeze. Here''s how these two options work out.
account might face a regulatory freeze for a variety of reasons. For
example, your account could have been inactive for more than three years with
no transactions. In such instances, the DP will freeze your demat account in
accordance with SEBI regulations.
statutory authorities such as SEBI, RBI, Government of India, CBI, ED, and
others might order the demat account to be frozen. Your demat account may also
be frozen if you fail to provide statutory information, such as your Aadhar
card, which is now necessary. These are all examples of regulatory freeze. When
your demat account is frozen, you won''t be able to make any credit or debit
significantly, there is something known as voluntary demat account freezing.
Let''s imagine you''re going to abroad for a while and won''t be able to
access your demat account. In that case, you might ask your broker to put your
demat account on freeze mode until further notice.
freeze, all corporate activities such as dividends, bonuses, and splits will be
delivered to you on time. However, no transactions are permitted in the demat
account. You can also place several types of freezes on your demat account. You
can place a general freeze on the demat account, which stops any credits or
debits. You can also just stop debits from your demat account, which is the
most common strategy used by most demat account holders. Finally, you can
freeze specific ISIN numbers so that the block only applies to those shares and
the others are available for trade.
If you are
willing to get rid of the freeze, you can look up for a process called
unfreezing of demat account?
of demat account means lifting up the freeze from your respective account,
whether it’s a voluntary freeze or regulatory freeze. By going through the KYC
process again, you can unfreeze your demat account. This is made mandatory to
safeguard your interests. The KYC procedure for reactivating your account is
pretty straightforward. You just need to submit the required documents and
identification proofs with the unfreezing form.