These days trading has become a popular mode to earn some extra money and accumulate wealth in the bank account. Also, the ease of access to trade in financial stock markets is one of the reasons why a lot of people are riveted by the concept of trading. This was not the case a couple of decades ago, but thanks to the interminable metamorphosis in technology, it has made trading a child’s play. Anyone with a gadget integrated with the internet, followed by a trading and demat account in hand, can commence their trading race expeditiously.
However, some people rush into creating trading accounts with the notion to trade regularly but end up slipping into something else. This turns your trading account into a dormant mode. Now, irrespective of the myriad benefits offered and provided by stockbroking companies or depository participants, some traders decide to shut down the trading account permanently. There can be multiple reasons to close a trading account.
Some traders get perplexed between closing and deactivating the trading account. If you want to take a recess from the trading activities, then instead of closing it completely, go for deactivation. Because once you shut down the trading account, there’s no way of getting it back. You cannot retrieve the account after it’s closed.
If you want your trade again, you have to create a new trading account by enduring through the series of steps and procedures followed by e-KYC verification and self-identification for a final check. In case, if you really want to close your trading account, then here are a few pointers that you must keep in mind.
Trading in India requires setting up two accounts, one is a trading account, and another is a demat account. There’s no use in having only one of the accounts. You should have both the aforementioned accounts to buy, sell, and store shares in electronic form.
While the trading account helps you to make transactions in the financial stock market, the demat account converts those shares into electronic form and stores them in the account. Monetary settlements are taken care of by the bank account connected with these two accounts. But there comes a time, where a trader wants to close his/her trading account. So, here’s a step-by-step guide on how to cease a trading account.
Step-1: The foremost thing you have to do before closing your trading account is to visit the respective stockbroking company or depository participant and inform them about the closure.
Step-2: As and when you do that, you’ll be given a trading account closure application to fill out all the necessary details. Prior to submission, crosscheck the whole application just to make sure there are no errors made. You can get this form on the depository participant’s website to download, or at one of their branches.
Step-3: If your trading account has multiple holders, then all of them must duly sign the trading account closure application. In addition to that, you should also write a valid reason for why you are shutting down the trading account in the application.
Step 4: Once the form is completely filled, you can submit it to your depository participant or stockbroking company asking them to do the needful.
Step 5: Finally, check your trading and demat accounts to see if there are any shares left behind to be sold. If yes, then clear up the entire account before the depository participant processes your account closure request. In case, if you missed clearing your account, your trading account closure application would be dismissed by your DP or stockbroker.
Apart from ensuring that your trading account does not have any unsold securities, it is also important to ensure that your account doesn’t reflect a negative cash balance. If such is a case then you would have to pay the balance or your account closure request will be rejected. And once that is done, it will take about 7-10 business days for the account to get closed
The trading account can either be a treasure trove or a nightmare for traders and investors. Of course, it’s an open platform filled with plenty of opportunities to cease and make good money. But sometimes, uncertain situations propel traders to close their trading accounts. If you are on a quest for the procedure to close your trading account, kindly follow the above steps. However, you can always open your account with the same stockbroking firm at a later stage. TradeSmart Online is a leading depository participant that allows traders to open an account online in five minutes. Click here to know more details about the TradeSmart Online trading and demat account services.
Yes, that is possible. The trading account can be closed but if it is linked to a demat account then you must ensure that the demat account is a standalone demat account or map it to another DP, otherwise you will have to close both trading and demat account.
If all documents are submitted and are correct, then it usually takes 7-10 business days to close a trading account.
Yes, it is mandatory to submit a physical copy of the form for closing a trading account.
In some cases, traders' accounts either go dormant or they temporarily freeze their account for various purposes. In such a case, the following steps need to be taken to reactivate it
There is a difference between closing an account and freezing an account. A frozen or dormant account can be reactivated but an account once closed cannot be reactivated. The person will have to visit the TradeSmart website and open a new 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.