Facility for Basic Services Demat Account (BSDA) for Financial Inclusion and Ease of Investing - SEBI - SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2024/91

CIRCULAR SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2024/91 June 28, 2024 To, The Depositories The Depository Participants (DPs) Sir / Madam, Sub: Facility for Basic Services Demat Account (BSDA) for Financial Inclusion and Ease of Investing 1. With the objective of achieving wider financial inclusion to encourage holding of demat accounts and to facilitate ease of investing, SEBI, vide circular no. CIR/MRD/DP/22/2012 dated August 27, 2012 read with Circular MRD/DoP2DSA2/CIR/P/2019/51 dated April 10, 2019 and Para 1.8.1 to para 1.8.5 of the Master Circular for Depositories dated October 06, 2023 provided for the facility of Basic Services Demat Account with a set of defined services for eligible individuals. 2. In order to further boost participation in securities market, ease of doing investments and based on representations from market participants, the facility has been comprehensively reviewed and the following has been decided: 2.1. Eligibility for BSDA An individual shall be eligible to opt for BSDA subject to the following conditions: a) The individual has or proposes to have only one demat account where he/she is the sole or first holder. b) The individual shall have only one BSDA in his/her name across all depositories. c) Value of securities held in the demat account shall not exceed Rs. 10 Lakhs for debt and other than debt securities combined at any point of time. 2.2. Opening of BSDA and conversion of existing eligible demat accounts into BSDA a) The DPs shall open only BSDA for Beneficial Owners (BOs), if such demat accounts are eligible for BSDA as per para 2.1 above, unless such BOs specifically provide their consent by way of email from their email-id registered with the DP to avail the facility of a regular demat account. b) The DPs shall also reassess the eligibility of all the existing BOs with respect to BSDA as provided in para 2.1 above within two months from the date of this circular coming into effect and shall convert all such eligible demat accounts into BSDA unless such BOs specifically provide their consent by way of email from their email-id registered with the DP to continue to avail the facility of a regular demat account. Later, this exercise shall be carried out by DPs at the end of every billing cycle. 2.3. Charges a) The charge structure shall be as indicated below: Value of Holdings in the Demat Account (Debt as well as other than debt securities combined) Maximum Annual Maintenance Charges Up to Rs. 4 lakhs NIL More than Rs. 4 lakhs but up to Rs. 10 lakhs Rs. 100 More than Rs. 10 lakhs Not a BSDA. Regular AMC may be levied. b) It is emphasized that other than AMC as specified above, BSDA shall be treated at par with non-BSDA for the purpose of levying charges for various other services and DPs shall not levy higher charges to BSDA. c) The value of holding shall be determined by the DPs on the basis of the daily closing price or NAV of the securities or units of mutual funds, as the case may be. Where such price is not available, the last traded price may be taken into account and for unlisted securities other than units of mutual funds, face value may be taken in to account. The value of suspended securities may not be considered for the purpose of determining eligibility of demat account as BSDA. d) If the value of holding in such BSDA exceeds the prescribed criteria at any date, the DPs may levy charges as applicable to regular accounts (non-BSDA) from that date onwards. 2.4. Services for Basic Services Demat Accounts a) Electronic statements shall be provided free of cost. b) Physical statement may be charged at a fee not exceeding Rs. 25/- per statement. c) All other conditions as applicable to regular demat accounts, other than the ones mentioned above, shall continue to apply to basic services demat account. 3. This circular shall come into effect from September 01, 2024 in supersession of para 1.8.1 to para 1.8.5 of the Master Circular for Depositories dated October 06, 2023. 4. The Depositories are advised to:- 4.1. make amendments to the relevant bye-laws, rules and regulations for the implementation of the above decision immediately, as may be applicable/necessary; 4.2. bring the provisions of this circular to the notice of their DPs and also to disseminate the same on their website; 4.3. put in place appropriate systems and procedures to ensure compliance of the provisions of this circular; and 4.4. communicate to SEBI, the status of implementation of the provisions of this circular in the Monthly Development Report. 5. This circular is being issued in exercise of powers conferred under section 11 (1) of the Securities and Exchange Board of India Act, 1992 and section 19 of the Depositories Act, 1996 to protect the interests of investors in securities and to promote the development of, and to regulate the securities market. 6. This circular is available on SEBI website at www.sebi.gov.in under the category: Legal Circulars . Yours faithfully, Aradhana Verma General Manager Market Intermediaries Regulation and Supervision Department Tel. No. 022-2644 9354 Email id [email protected]