Pro­ce­dure for Trad­ing/Set­tle­ment

Consumer Voice - - Bfsi -

The pro­ce­dure for buy­ing and selling de­ma­te­ri­alised se­cu­ri­ties is sim­i­lar to the pro­ce­dure for buy­ing and selling phys­i­cal se­cu­ri­ties. The dif­fer­ence lies in the process of de­liv­ery (in case of sale) and re­ceipt (in case of pur­chase) of se­cu­ri­ties. In case of pur­chase:

ac­count on the pay-out day.

his ac­count and credit BO’s ac­count. re­ceiv­ing credit by fill­ing in ap­pro­pri­ate form. How­ever, BO can give stand­ing in­struc­tion for credit to his ac­count that will ob­vi­ate the need of giv­ing re­ceipt in­struc­tion ev­ery time. In case of sale:

BO will give de­liv­ery in­struc­tion through de­liv­ery in­struc­tion slip (DIS) to DP to debit his ac­count and credit the bro­ker’s ac­count. Such in­struc­tion should reach the DP’s of­fice at least 24 hours be­fore the payin, fail­ing which DP will ac­cept the in­struc­tion only at the BO’s risk.

Pledg­ing of Se­cu­ri­ties

The pro­ce­dure to pledge elec­tronic se­cu­ri­ties is as fol­lows:

must have BO ac­count with the same de­pos­i­tory. in pre­scribed stan­dard form (pledge re­quest form) with the de­tails of the se­cu­ri­ties.

through his/her DP. and the pledgee are han­dled as per usual prac­tice out­side the de­pos­i­tory sys­tem. The pled­gor can change the se­cu­ri­ties of­fered in a pledge, pro­vided the pledgee agrees. As to who will re­ceive the cor­po­rate ben­e­fits on the pledged se­cu­ri­ties, it is the pled­gor. The se­cu­ri­ties pledged are only blocked in the ac­count of pled­gor in favour of the pledgee.

Af­ter the re­pay­ment of loan, pled­gor can re­quest for a clo­sure of pledge by in­struct­ing the DP in a pre­scribed for­mat. The pledgee on re­ceiv­ing the re­pay­ment will in­struct his DP ac­cord­ingly for the clo­sure of the pledge.

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