In recent times we have witnessed a surge in digital modes of transactions as the contactless exchange of money is being promoted. Digital wallets and UPIs are becoming ubiquitous. The government has also been pushing persistently to develop a cashless economy. However, if we trace back the digital revolution in the financial sector in India, we’ll probably halt at the share markets.

Share Markets got digitized back in 1996 after the Depositories Act was passed. This Act put an end to the prevailing open outcry system in the share market. In those days, owning a share required one to maintain physical copies of share certificates, and trading in shares involved lots of paperwork. All this changed after the share markets got digitized. Now, one could trade in stocks from anywhere through a trading account and store the shares digitally in a Demat account. 

What is a trading account?

A trading account is a medium through which you can trade in the stock market. You can place an order to buy or sell a stock through it. Your order request is forwarded to the stock exchange and when the order gets executed, you get the shares credited into your Demat account.

Today, if you have to trade in the stock market, you need to create Demat account and trading account . But no need to worry! Opening a trading account is easy and most brokers offer Demat account along with the trading account.

Tips to open a trading account online:

  1. Find an online stock broker: Just like you visit a bank to open a savings account or fixed deposit account, you need to approach a stock broker to open a trading account. There are several banks that offer the services of a stock broker as well and can help you open a trading account. Conduct thorough research and choose a reliable broker.
  2. Once deciding the broker, check for their online account opening form. It’s generally available on their website which you can fill and submit within 10-15 minutes. You need a PAN Card to open a trading account. 
  3. First, you fill your name, mobile number, email, etc. then add your PAN Card details, address, and bank details. Bank details are added to link it with your trading account. After your account is opened, you can add money from your bank account to your trading account; you can also transfer it back from the trading account to the bank account when needed. 
  4. Along with these details, you have to upload soft copies of your KYC documents for proof of address and proof of identity. 
  5. Next, you have to perform in-person verification. Some brokers might call you over the phone to confirm your details. This step is essential to eliminate the risks of someone else using your details to open an account. Some brokers might give you the option of e-verification where you upload a short video of yourself as an authentication. 
  6. Again, depending on the broker, you might be required to take a print out of the form and sign it physically. Others might provide you the option to e-sign through Aadhaar. In this, you enter your Aadhar number and receive OTP on your Aadhar linked mobile number. 
  7. Once you have signed the form, you will have to send it to the broker, or in the case where the broker lets you e-sign through Aadhar, you can submit the form after confirming the details. 

Once your form is submitted, you will receive a confirmation from the broker once your account is opened. Again, depending on the broker, it might take anywhere from a few hours to a few days. Once your account is opened you will get login credentials to log in to your trading account.

Trading Account Charges

Opening a trading account can be free or chargeable depending on the stockbrokers. If the broker offers trading and Demat account together, there will be an Annual Maintenance charge for the Demat account. It is preferable to get both the Demat and trading account as both are needed to trade in stocks. Some stockbrokers provide you the option to open Demat and trading account online for free with zero Annual maintenance charge for a year.    

Why wait any longer? Get your trading account today and start trading in the stock markets.

Investments in the securities market are subject to market risk, read all the related documents carefully before investing.