Sebi more than doubles value of securities that basic-services demat account can hold

To drive financial inclusion, the market regulator has revised the framework for Basic Services Demat Account (BSDA) and raised the value of securities that can be held in it from Rs 4 lakh to Rs 10 lakh.

A circular issued by the Securities and Exchange Board of India (Sebi) on June 28 stated: “Value of securities held in the demat account shall not exceed Rs 10 Lakhs for debt and other than debt securities combined at any point of time.”

It also said that to qualify for this account, the individual can only have one demat account where he/she is the sole or first holders, and that the individual shall have only one BSDA in his/her name across all depositories.

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Services rendered to these accounts are as follows: electronic statements to be provided free of cost; and physical statement may be provided for a fee not Rs 25 per statement. The circular added that all other conditions as applicable to regular demat accounts, other than the two services mentioned, shall continue to apply to BSDA.

The maintenance charges of these accounts are as follows: For those holding securities that total in value upto Rs 4 lakh, and the charges will be zero; for value of more than Rs 4 lakh and up to Rs 10 lakh will be Rs 100. For accounts holding securities that are valued over Rs 10 lakh will not be considered BSDA and therefore regular charges will be levied.

The circular added that the the value of holding should be determined by the depository participants (DPs) on the basis of the daily closing price or NAV of the securities or units of mutual funds, as the case may be. Where such price is not available, the last traded price may be taken into account and for unlisted securities other than units of mutual funds, face value may be taken in to account. The value of suspended securities may not be considered for the purpose of determining eligibility of demat account as BSDA.

Depository participants (DPs) have been asked to reassess the eligibility of all beneficial owners to hold BSDA within two months from the issue of the circular and convert all eligible accounts to BSDA.