What does DP charges mean?

Mr Sharma, 32 years old, began investing in shares and stocks recently. He was trying to sell a stock last month when he became confused by the minimal fee levied on his transaction. After that, Mr. Sharma began to go through his Demat account's contract notes. He couldn't find any information about the fee in his Demat account contract notes. Mr. Sharma was unsure about the amount towards DP fees or charges. Let's help him to understand these charges.

How much are DP charges?

All transactions in your Demat account are subject to depository participant (DP) fees. These fees are not included in contract notes and do not reflect brokerage. DP fees are revenue sources for depositories and their participants.

DP fees are a flat transaction fee that is not affected by the amount of merchandise sold. The fee is charged per scrip, not by the volume. These charges are the same regardless of whether you sell one share or 100 shares.

Who imposes DP fees?

Depositories and depository participants can both levy DP charges. National Securities Depository Limited ( NSDL) imposes the tax on stock that is part of Nifty. Central Depository Securities Limited (CDSL) will levy the tax if the stock is part BSE. Depository participants act as a mediator between investors and depositories. Angel One is, for example, the depository participant if your Demat account has been maintained. Depository participants include banks, financial institutions, and stockbrokers.

Depository participants usually levy four types of fees (or charges) for Demat account transactions: account opening fee; annual maintenance fee; custodian fee and transaction fee.

What are the DP charges levied?

To provide Demat accounts to clients, a stockbroker must become a participant in a depository. They will also need to pay a membership fee for CDSL or NDSL to provide a Demat account to clients. These charges are passed on to customers by brokers who charge an additional fee to recover them.

How much DP charges are levied?

All sell transaction fees are subject to the same charges that depositories levy. These charges include:

  • Demat transaction fees for CSDL: Rs. 13 plus Rs. 13.50
  • Rs. 13 plus Rs. 13.50

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