11 March, 2025
Synopsis
A Demat Account allows you to hold shares and securities digitally, making stock investments seamless.
Various charges apply, including an Annual Maintenance Charge (AMC), custodian fees and transaction fees, which vary based on account type.
HDFC Bank offers a convenient 2-in-1 Demat Account by linking your Demat, Trading and Savings Accounts.
Demat Accounts have made investing in stocks simpler and quicker than ever. You can now keep track of your shares and stock, and digitally operate your Demat Account from anywhere in the world.
Demat, short for dematerialisation, Account holds your shares and securities in an electronic format. A Depository Participant (DP) is responsible for carrying out this process. Depository Participants can be a bank, stockbroker or any other financial institution that meets the DP criteria issued by the SEBI.
The Depository Participant acts as a link between the authorising body of your shares. The authorising body can be either the Central Depositories Services Limited (CDSL) or the National Securities Depository Limited (NSDL).
All Depository Participants charge a fee for opening and operating a Demat Account. You can read more about this here. The Annual Maintenance Charge (AMC) is one of the fees that all Demat Account holders must pay. This article will give you all details you need to know about the AMC for Demat Account.
Demat Account Annual Maintenance Charges
The Brokerage Houses and Depository Participant (DPS) levy a minimal annual maintenance fee or the folio maintenance fee for their services. You can pay the fee as a one-time payment or quarterly. Here is a breakdown of the charges for the different account types at HDFC Bank:
Demat Account Type | Annual Maintenance Charge (₹) |
Classic | ₹500 (₹250 in case of 1 transaction p.a.) |
Standard | ₹750 |
Prime | ₹700 |
Preferred | ₹300 (Zero in case of 1 transaction p.a.) |
Infiniti/Imperia | NIL |
Applicable Taxes
Goods and Services Tax (GST): 18% on all Demat-related fees.
Securities Transaction Tax (STT): Levied on share purchases and sales as per government regulations.
Most Depository Participants offer zero AMC Demat Account in the first year to their customers. Many depositories also offer to open a Demat and Trading account together. The annual maintenance fee in such a case is lower than the usual amount.
The AMC may differ if you open a Demat Account in one bank while the Savings Account linked is in another.
Note: Even if your Demat Account is inactive, you are liable to pay the account maintenance charge.
Other Charges Associated with a Demat Account
1. Account Opening Charges/Fee
To Open Demat Account, all investors must pay a basic opening fee. Generally, the fee amount is negligible or has offers associated with it to encourage more people to open an account. You can also open 2-in-1 accounts. This facility allows you to link your Demat, Trading, and Savings Accounts, making it easier to carry out transactions.
2. Custodian or Safety Fee
To keep your securities safe with the custodian, the Depository Participant charges a custodian or safety fee. You are charged ₹1 for each International Securities Identification Number (ISDN) mapped to your Demat Account.
You can pay the custodian fee as a one-time payment or every month. The payable fee depends upon the number of securities you hold.
Note: There will be no charge on every ISDN mapped if you have paid the custodian fee as a one-time payment.
3. Transaction Fee
Every time you buy and sell shares from your account, you are liable to pay a monthly transaction fee. The amount payable depends upon your type of transaction. Typically, a basic fee of ₹1.5 is charged for every transaction.
You can choose to open multiple Demat Accounts but, you can hold only one account with a depository. It is generally advisable to open two Demat Accounts; you can use one account for trading purposes while the other can be for long-term investments.
Opting for a Demat-cum-Trading Account can be very beneficial, as you can keep a check on your accounts under one tab. This account allows you to make seamless trades within a matter of a few minutes.
HDFC Bank offers you a 2-in-1 account where you can open and link your Demat and Trading. To open a 2-in-1 Demat Account with HDFC Bank, click here.
*Disclaimer: Terms and conditions apply. This is an information communication from HDFC bank and should not be considered as a suggestion for investment. Investments in securities market are subject to market risks, read all the related documents carefully before investing.