Here we tell you the step-by-step process to convert your physical shares into demat form
28-Apr-2022
Let's say your grandparent bought shares in a company 30 years ago and you recently found them. The shares have grown a lot and you just became a millionaire. But there is one thing, the shares are in physical form, i.e., you only have physical share certificates. You're upset that you may never be able to sell those shares, but what if there is a way? Although the demat form of shares is the most common these days, there are some cases like this where people hold physical shares. Today in this article, we are going to look at the simple steps to converting physical shares into demat form.
Steps to convert physical shares into demat shares:
Taking an example, if you are opening a demat account with Zerodha or have a demat account with Zerodha, you can refer to the steps here to get the DRF, where to send the form and certificate and any other documents required.
Why is dematerialisation good?
Prior to 1997, shares were held in physical form. It was highly vulnerable to fraud and there were constant security concerns. Since the shares were in physical form, there were also concerns about storage and maintenance. Transferring of shares took time and there was a risk of losing certificates in transit. Physical certificates were also counterfeited sometimes.
Dematerialisation of shares solved all these issues. Shares were transferred digitally and the worry about authenticity is not there since each demat share is authenticated by ISIN. Concerns regarding storage and maintenance of shares were also eliminated.
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