Everything has a flip side, and technology is no different. While the application of technology has made the process of trading in the securities market more accessible, there are several threats associated with the process, particularly hacking of demat and trading accounts. In this article, we shall discuss how to open a demat account online, and keep such an account safe from various cybersecurity threats.
How to open a demat account
A demat account is where your market-linked securities get stored after the settlement of purchase transactions or transfers from other demat accounts. In order to open a demat account online, you must follow the steps mentioned below.
- Select a depository participant or brokerage firm with high credibility in the market and offering a demat account with the required features and feasible demat account charges. .
- Fill the demat account opening form at the selected DP's official website.
- Submit important documents such as your Permanent Account Number, a valid proof of identity, recent passport size photographs, a valid proof of address, and bank account details.
- Complete the step of In-person Verification online.
- Access your demat account once your DP has shared the login details.
Strategies to safeguard your demat account against hacks
Once you have opened your demat account and checked the account particulars on the depository participant's official trading platform, you can take some simple measures to safeguard the account against a host of digital threats, including unauthorized access.
- Always access your demat account on the broker/ depository participant's official platform: You must always use your DP's or stock broker's official trading platform to access your demat account. Furthermore, you must choose safe browsers to access the account and log out once you are done checking or using the account.
- Ensure your demat account is protected by a strong password: One easy step you can take to secure your demat account is setting a strong password for it. The password must be alphanumeric and difficult to guess. You must set a password that is easy for you to remember. It is also possible to enable Two-factor authentication on your demat account to prevent access without a One Time Password (OTP) shared on your registered email address and/ or mobile number.
- Access your account on a regular basis: After opening your demat account, you must check it on a regular basis, say, weekly or monthly. Not only is this necessary to check the activity in your account, but also to detect unauthorised access at the earliest.
- Meticulously check your demat account statements: It is important to check the demat account statements shared by your DP on a periodic basis. The demat account transaction statement sheds light on the transactions pertaining to the account and the demat account holding statement contains information about the demat holdings in your account.
- Never share your demat account log in details with anyone: In order to keep your demat account safe from any unauthorised access, you must never share your account credentials with anyone. Your demat account login ID and password serve as gateways for the account, and sharing this information with anyone makes the account vulnerable.
- Pay your demat account charges on time: Another important measure you can take to secure your demat account is pay all the demat account charges on time and prevent the account from being deactivated.
The bottom line
You can follow the aforementioned steps, amongst others, to safeguard your demat account. The key lies in opening a demat account with a credible DP that has a highly secured trading platform. Secondly, you must control the access to your demat account, and regularly check the account and the associated statements.
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