What is a Basic Service DEMAT Account?

Basic Service Demat Account (BSDA) is a special type of DEMAT account that was introduced in 2012 by SEBI (Securities and Exchange Board of India). It requires much less of an investment compared to a general Demat Account and is mainly intended for small investors who are not keen on regularly investing in Stocks, ETFs, mutual funds, etc. It also reduces the burden on investors who have a DEMAT account with smaller portfolios of below Rs. 2,00,000 Lakhs across the depositories.

Benefits of BSDA

The BSDA has a number of benefits when it comes to cutting down on costs and expenses. Here is a list of the key benefits of BSDA.

– Charges for physical statements that are to be mailed to the customer is mitigated.

– The dematerialization charges are cut off.

– Annual maintenance charges that amount between Rs. 600 and Rs. 800 are reduced.

What is the eligibility criteria of BSDA?

While BSDA can come along with several benefits, there are certain criteria to be met in order to be eligible to open a Basic Service Demat Account. Here is the list of the criteria to keep in mind.

1. The investor should be the sole owner of the account.
2. The investor should not have any other Demat account.
3. Only one Demat account can be held under the BSDA category.
4. The total value of the BSDA shares should not exceed Rs. 2 lakh at any point.
5. If the investor has a joint account, he/she should not be the first holder of the account.

What are the charges levied on BSDA?

Charges for BSDA will differ from Broker to Broker. However, at Angel Broking the following are the charges levied on BSDA. 

  1. AMC (Annual Maintenance Charges)
Value of holdings AMC Charges
< Rs.50,000 Zero
Rs.50,000-Rs.2 Lakhs Rs.100 + GST/year
> Rs.2 Lakhs Same as non-BSDA accounts
  1. Physical statements
    Two hard-copy statements are provided free of cost during the billing cycle. Additional statements can be availed at some additional cost. 
  2. Additional charges
    Some of these include cheque bounce charges, rejection of a Delivery Instruction Slip (DIS), rejection of a Demat Request Form (DRF), and regular transaction & other charges.

How do I convert my Demat Account to a BSDA Account?

An existing Demat account can be converted into a BSDA Account only under certain conditions. The regulator has a right to check with depositories. Wherever applicable, the depository will exercise the right to convert the Demat account into BSDA. The regulator will then change the status of your account to a BSDA account.  

It is important to ensure that you have no other Demat Account for your current Demat Account to be converted to BDSA. Based on the highest value of your holding, AMC will be charged accordingly. However, in case the threshold is crossed by your holding value or you have an active Demat Account with another broker, your BSDA account will be converted to a non-BSDA account.