In a significant move to promote financial inclusion and simplify investing, SEBI has announced a comprehensive review and update of the Basic Services Demat Account (BSDA) facility. The updates aim to widen participation in the securities market and ease investment processes for individuals.
SEBI has increased the threshold for BSDA to Rs 10 lakh from the current Rs 2 lakh. Individuals can opt for a BSDA if they have only one demat account where they are the sole or first holder. An individual is permitted only one BSDA across all depositories. The total value of securities in the demat account must not exceed Rs 10 lakh, combining both debt and other securities.
Depository Participants (DPs) are required to open only BSDA for eligible individuals unless explicitly requested otherwise via registered email. Existing eligible demat accounts must be converted to BSDA within two months of the circular’s effect unless the account holders opt out via registered email.
There will be no annual maintenance charges for accounts with holdings up to Rs 4 lakh. An annual maintenance fee of Rs 100 will be charged for accounts with holdings between Rs 4 lakh and Rs 10 lakh. Regular maintenance charges will apply if the value exceeds Rs 10 lakh.
This new circular will take effect from September 1, 2024, superseding specific provisions of the Master Circular for Depositories dated October 6, 2023. SEBI has directed depositories to amend their regulations, inform their DPs, and ensure the implementation of these provisions
