abhishreshthaa
Abhijeet S
Who is Depository Participant??
CONDITIONS TO BE A DEPOSITORY PARTICIPANT:
In terms of the Depositories Act, 1996, SEBI Depositories& Participants) Regulations,1996, only the following entities are eligible to become a Depository Participant:
WHAT ARE THE FUNCTIONS:
- A Depository Participant (DP) is an agent of the depository.
- They are the intermediaries between the depository and the investors.
- The relationship between the DPs and the depository is governed by an agreement made between the two under the Depositories Act.
- In a strictly legal sense, a DP is an entity who is registered as such with SEBI under the provisions of the SEBI Act.
- As per the provisions of this Act, a DP can offer depository related services only after obtaining a certificate of registration from SEBI.
CONDITIONS TO BE A DEPOSITORY PARTICIPANT:
In terms of the Depositories Act, 1996, SEBI Depositories& Participants) Regulations,1996, only the following entities are eligible to become a Depository Participant:
- Public Financial Institution
- Banks including Foreign Banks
- State Financial Corporation
- An Institution engaged in providing financial services promoted by above mentioned jointly and severally
- Custodian of Securities
- Clearing Corporation or Clearing House of a Stock Exchange
- Stock Broker
- Non Banking Financial Company
- Registrar & Transfer Agents
WHAT ARE THE FUNCTIONS:
- Dematerialisation i.e. converting physical securities into electronic form.
- Rematerialisation, i.e. converting electronic securities balances in a BO account into physical form.
- To maintain record of holdings in the electronic form. Settlement of trades by delivering/ receiving underlying securities from/in BO accounts.
- Settlement of off-market trades i.e. transactions between BOs entered outside the Stock Exchange.
- Providing electronic credit in respect of securities allotted by issuers under IPO or otherwise.