Many individuals, especially novice traders, tend to confuse both demat accounts and trading accounts. However, the fact of the matter is that a demat account and a trading account are two completely different accounts that each have their own functions. This leads them to think that to gain access to the funds that you receive from a sale, you would have to transfer it from the demat account to the bank account.
However, contrary to popular opinion, this is not true. Want to know more information on how to transfer money to your bank account? Continue reading to find out. But before that, let’s quickly go through what a demat account is, its function, and whether you can transfer money from a demat account to a bank account.
A demat account is essentially an electronic account that allows you to store securities such as shares, mutual fund units, bonds, debentures, and Exchange Traded Funds (ETFs) in a digital form. Apart from the function of being used to store such securities safely and securely in an electronic form, the demat account has very little use apart from it.
The short answer is no. As you’ve already seen above, a demat account’s function is only to store shares and other securities that you’ve bought through the stock exchanges. But what do you do if you want to trade your shares? That’s where the trading account comes into the play.
A trading account is an electronic account that allows you to purchase and sell securities on the stock exchanges. And since this is the primary function of the account, the funds that you wish to use to buy or sell shares from the stock exchanges have to be transferred to the trading account.
So, when you buy shares from your trading account, you use the money that you transfer to it from your bank account. Similarly, when you sell shares, the return that you make on the trade is credited again to the trading account.
Now, to make use of this amount that you generate through a sale, you would have to transfer it (by initiating a pay out) from your trading account to your bank account. Without making this transfer, the money would continue to stay in the trading account and wouldn’t be available for any other use apart from buying shares once again.
So, it is your trading account from where you would have to transfer funds to your bank account for your use. Therefore, it is extremely crucial for you to know just how to initiate a payout transfer from your trading account to your bank account.
Transferring funds from your trading account to your demat account is extremely easy and takes only a few minutes to complete. This is especially true in the case of TradeSmart trading accounts. In fact, with TradeSmart, there are as many as 3 major ways through which you can initiate the payout transfer to your bank account.
Your back office platform – BOX is a powerful tool that not only provides you with a wealth of information, but can also be used to transfer money from your trading account to your bank account. Here’s what you would have to do.
If you’re a TradeSmart Mobile application user, follow the below mentioned steps to initiate a pay out transfer from your trading account to your bank account.
On the other hand, if you’re an experienced trader using the NEST Trader desktop application to conduct stock trading, the process that you will have to follow is –
Now that you’re aware of how you can transfer funds from your trading account to your bank account, here are a few things that you should know and account for.
Before you go ahead and place a payout fund transfer request from your trading account to your bank account, it is advisable to first take a good look at the balance that’s free for transfers.
Sometimes, if you have any pending or open stock market positions, your trading account may show a balance, but it may not allow you to transfer the funds out of the account. In such cases, you will have to close all your positions first to release the funds before placing a fund transfer request.
Your demat account is only used to store any bought securities like shares, bonds, ETFs, and mutual fund units. It does not hold any money or funds in it. The trading account, on the other hand, is what holds all of your funds. So, if you’re interested in transferring funds to your bank account, you would have to do it from the trading account.
Yes. The cut-off time for placing fund transfer requests is 7.00 AM, if the request is placed via BOX.
Alternatively, the cut-off time for placing fund requests on all other applications is 11.59 PM.
You can place fund transfer requests within the relevant cut-off timings on the 1st and 3rd Saturdays of each month.
While you can place a request on the 2nd and the 4th Saturdays and on all Sundays, the request will not be processed until the next business day.
If your recipient bank account is from ICICI Bank, it normally takes around 3-4 hours from the time the request is processed.
Alternatively, if your recipient bank account is not from ICICI Bank, the time taken would be dependent on RBI’s NEFT settlement timings.
Yes. You can use any application, mobile or web, from TradeSmart to place a fund transfer request to your bank account.
Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.
Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.
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Please note that by submitting the above mentioned details, you are authorizing TradeSmart to call and email you and also to send promotional communication even though the contact number may be registered under DND.