Investors can now open a demat account for free in trading and investment platform Zerodha. The company said on Wednesday that now no charge will be taken from investors living in India for opening a demat account.
The company said that the onboarding process of opening an account has now become completely digital, so the company has taken this decision. Earlier there was no facility of e-signing through Aadhaar to open a demat account, due to which there was an offline process to open a demat account. Therefore, the company used to charge for account opening.
There was no e-sign process till 2016-17
The company said, ‘When we started Zerodha, we deliberately decided to charge for opening an account for two reasons. There was no Aadhaar or e-sign process till 2016-17.
The process of opening an account was completely offline, which means it involved costs. Therefore, we had to charge account opening charges to cover the costs.’ However, many trading platforms including Groww, Angel One are already opening demat accounts for free.
Demat accounts increased 5 times in the last 6 years in the country
According to the data of Central Depository Services Limited and National Securities Depository Limited, the number of demat accounts has increased 5 times in the last 6 years. There were 3.6 crore accounts in the year 2019, which has now increased to 15.1 crores.
Zerodha may discontinue zero brokerage service
Zerodha may end the ‘Zero Brokerage Framework’, or increase the trading fees of Futures and Options (F&O). Zerodha’s co-founder and CEO Nitin Kamat recently gave these indications. This may happen due to the new circular of market regulator SEBI.
Nitin Kamat wrote on social media platform X – SEBI has recently issued a circular. It states that Market Infrastructure Institutions (MIIs) like stock exchanges will have to levy charges ‘as per the label’ from October 2, 2024.
This circular will not only affect brokers but also traders and investors. It is likely that the zero brokerage structure will have to be abandoned or brokerage for F&O trades will have to be increased. Brokers across the industry will also have to change their prices.
