NSDL and CDSL both doesn’t charge the investors directly but charges its DPs, who are free to have their own charge structure for their clients.
In other words, the DP charges are applicable whenever an individual sell any share from his/her Demat Account, and this charge is a source of income to the depositories or its participants.
The DP charges don’t reflect in your contract notes, it directly posted on the ledger. DP charges are charged once per scrip on a single day irrespective of the quantity sold.
DP charge of (₹4.5 for NSDL or ₹5.5 for CDSL) + Debit charges levied by the stockbroker.
Why DP charges are charged?
In our previous articles, you learned that to provide a Demat Account to clients each broker must become DP. And all these DPs need to pay a membership fee to Depositories (NSDL or CDSL) and that membership goes in lakhs with various fixed costs as well as advanced prepaid transaction charges.
In also addition the brokers pass on these charges to their customers by adding an additional fee to recover these expenses.
How to avoid these DP charges?
When the DP charges then the common question arise of many traders, and investors that how to avoid these DP charges?
- By closing your intra-day position.
- By taking Buy Today Sell Tomorrow (BTST) trade.
- By trading in the futures segment.