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In March 2024, the total number of Demat accounts in India reached an all-time high of 151 million. This powerful financial instrument is not just an account but a revolution. It’s the golden key that unlocks a seamless trading experience, integrating your savings, trading, and demat accounts into one cohesive unit. There would be no more delays in transactions or need to switch between systems.
Investing in a 3-in-1 demat account allows you to embrace a smarter and more efficient future, where your investments in the market are maximised. In a country where the number of active clients in the NSE continues to rise for the ninth consecutive month, reaching 40.8 million, the 3-in-1 demat account is poised to become the future of trading in India.
So, are you prepared to join this groundbreaking financial movement? Stay tuned as we unravel the benefits of the 3 in 1 demat account.
What is 3 in 1 demat account?
A 3-in-1 demat account is a versatile financial tool that brings together three crucial accounts into a single, integrated platform. There are three parts to it: a savings account, a trading account, and a demat account.
A demat account is responsible for storing your securities. Your stocks, bonds, mutual funds, and other investments can be safely stored in its digital vault. Your trading account serves as your access point to the stock market. You can purchase and sell securities with this account. Your funds are held in the savings account. Transactions are funded from this account.
The integration of a 3-in-1 demat account in India is truly remarkable. You can easily move money from your savings to your trading account when you buy shares. Within your demat account, the shares are safely stored. This streamlined procedure saves you time and energy by doing away with the necessity for manual transfers.
3-in-1 demat account comparison with simple demat account
Both 3-in-1 demat account and a simple demat account fulfil the function of electronically holding securities. Nevertheless, there exist significant distinctions between the two options, which render the 3-in-1 demat account a more convenient choice for numerous investors.
A basic demat account serves as a dematerialized account for securely holding your securities. To trade these securities, a separate trading account is required. In addition, to finance these transactions, a bank account is required. You’ll need to manage three separate accounts (demat, trading, and bank) that could be held with different service providers.
Alternatively, a 3-in-1 demat account consolidates the demat, trading, and bank accounts into a single entity.
Key features
Here are the key features of a 3-in-1 demat account:
- Integrated accounts: With the 3-in-1 demat account, you can conveniently manage your demat, trading, and savings accounts all in one platform. This facilitates smooth transactions between these accounts.
- Minimal paperwork: The account opening process is streamlined and requires very little paperwork. Only your PAN and Aadhar card are required.
- E-KYC facility: The E-KYC facility streamlines the account activation process, ensuring speed and efficiency.
- Swift activation: The activation of your demat and trading accounts will be done within one day of you finishing the required KYC procedure.
Advantages
- Simplicity: The process of opening new demat and trading accounts is made more efficient, saving time and effort. Automated processes improve the user experience.
- No minimum balance requirements: These accounts typically do not require a minimum balance, offering flexibility, accessibility, and convenience. This promotes financial inclusion and empowers customers to effectively manage funds based on requirements.
- Holding investments: The value of your investments could increase with time. Market fluctuations and short-term volatility can be efficiently navigated by keeping your investments. It can also help you avoid transaction fees for buying and selling shares frequently.
- Nomination facility: Account holders have the option to nominate their family members for added security measures.
- Seamless transactions: One major benefit is the smooth integration of savings and trading accounts for seamless transactions.
- Easy tracking and managing investments: Managing investments becomes a breeze with a 3-in-1 demat account.
- Sophisticated trading tools: 3-in-1 demat accounts provide advanced trading tools that enable efficient trading in the share market.
How to open a 3-in-1 demat account
Opening a 3-in-1 demat account is a simple and convenient process that can be easily completed online. These are the steps to open a 3-in-1 demat account:
- Check out the website of the bank or broker you’re interested in to open the account.
- Choose to open a 3-in-1 account.
- Please provide your mobile number and PAN.
- Please provide your Aadhaar number for OTP verification.
- Complete the online application form as directed.
- Please schedule an appointment for KYC.
- After the KYC process is finished, you will soon receive the account details for all three accounts.
To open a 3-in-1 demat account, you need to meet certain eligibility criteria. You need to be 18 or older and a resident of India to participate. Furthermore, it is crucial to ensure that their Aadhaar is connected to their mobile number for Aadhaar OTP-based KYC, and their original Permanent Account Number (PAN) is required for video KYC.
Bottomline
The emergence of 3-in-1 demat accounts represents a noteworthy achievement in India’s financial realm, providing investors with a convenient and effective method to oversee their investments.
Investors can enjoy the convenience of seamless transactions, minimal paperwork, and swift activation processes with the integration of demat, trading, and savings accounts into a single platform.
FAQs
Yes, one of the key advantages of a 3-in-1 demat account is that it usually does not require a minimum balance. This provides flexibility and convenience to the customers, allowing them to manage their funds according to their needs and preferences. However, some banks may put a clause of minimum trading activity in your trading account.
Starting to trade involves a few key steps. First, open a demat and trading account with a broker. Next, deposit funds into your account. Choose a trading platform, such as MetaTrader 4 (MT4), and select the markets you want to trade in. It’s important to understand the risks involved and develop a trading strategy. Remember to declare all profits from online trading for taxation purposes.
Trading can be profitable, but it requires a well-defined strategy and discipline. Profitability depends on factors like the starting capital, strategies used, markets traded, and even luck. However, it’s important to note that a significant number of traders lose money. This is often due to lack of discipline, poor risk management, and overtrading. Therefore, successful trading involves not just strategy, but also careful risk management and emotional control.
To buy stocks, you need to open a demat and trading account with a broker. Once the account is set up, you can sign in to your account, choose the stock you want to invest in, and ensure you have sufficient funds in your bank account. You can then purchase the stock at its listed price and specify the number of units. The shares will be transferred to your demat account.
While a laptop is not strictly necessary for trading, it can offer flexibility and mobility. Modern trading laptops are powerful enough to handle trading software and can be a good choice if you plan on trading on-the-go. However, a desktop might be more affordable for the same specifications and could be a better option if you’re trading from a fixed location.