Basic Services Demat Account — Cheapest Bsda Account 2022
SEBI launched the Basic Services Demat Account (BSDA) model in 2012. The goal was to make demat fees less burdensome for investors with small portfolios. So, let’s take a closer look at the BSDA Account with related details.
Basic Services Demat account
Basic Services Demat Account (BSDA) is a special category for Individual investors with a small portfolio of up to INR 50,000 and who do not or cannot invest frequently in stocks, bonds, ETFs, mutual funds, and other securities.
However, charges for portfolios from INR 50,001 up to INR 2,00,000 are also less then investors who hold assets more INR 2,00,000.
SEBI believes that the large percentage of DEMAT account holders do not utilize their accounts as frequently as they should and pay excessive maintenance costs as a result. As a result, they created this account type to assist such investors.
One condition for BSDA is that you must have just one DEMAT account throughout all depositories, i.e. the BSDA must be your sole DEMAT account.
Annual Maintenance Charges Slabs
The Annual Maintenance Charges (AMC) for BSDA will be calculated on a slab basis based on the worth of the holding as shown below:
Note
- For both BSDA and ordinary accounts, the commission and taxes are the same.
- The DPs (in this scenario, a broker) will measure the worth of the holding based on the daily closing price or NAV of the assets or units of mutual funds. If the worth of an investment in such a BSDA exceeds the statutory threshold at any point during the period for which it is levied, the DPs may levy standard account (non-BSDA) fees from that point on.
Who is eligible to open a BSDA demat account?
The basic services demat account (BSDA) is a type of demat account that offers restricted services to individual investors at a lower cost.
To put it another way, the BSDA is a no-frills-demat account. Anyone can open a BSDA account, and current demat accounts can be transformed into no-frills BSDA accounts if certain requirements are met.
There are two points to keep in mind here. To begin with, the BSDA facility is only available if the investor is the only owner of the property.
In the case of shared accounts, BSDA is not permitted. Second, an individual is only allowed to have one BSDA account throughout all DPs to prevent share holdings from being split to bypass the value criteria.
At any given time, the user must ensure that the value of assets kept in his basic trading account does not exceed INR 2,00,000. The DP decides on this depending on market value.
So, if you purchased shares costing INR 1,50,000 and they have now risen to INR 2,20,000, you are not qualified for BSDA and must pay the standard charges.
All depository participants (DPs) are required by SEBI to offer basic demat accounts with fewer services and lower charges. If the prerequisites are met, no DP can reject to run your demat account as a BSDA account.
Originally published at https://profitmust.com on December 12, 2021.
