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Question
Explain four advantages of Depository system to the Company.
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Solution
- Up-to-date Information: The up-to-date information about investors is provided by the depository.
- Reduction in costs and efforts: Costs, efforts, and time involved in printing and distribution of certificates in cases of new issues, bonuses, transfers, etc. are saved.
- Better Investor - Company Relationships: The complaints arising out of the loss of certificates, signature differences, long lapses of time in executing requests, etc. are substantially reduced. It leads to better communication with investors and increased goodwill for the company.
- International Investment: Under Depository System, better and quicker services can be provided and this attracts investments from abroad.
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RELATED QUESTIONS
Write notes on Importance of Depository system.
Select the correct answer from the options given below and rewrite the statement.
In Depository System, securities are held in ______ form.
Select the correct answer from the options given below and rewrite the statement.
______ has to pay charges to maintain Demat Account.
Write a word or a term or a phrase which can substitute the following statement.
This mode of holding securities may result in loss and theft of certificates.
Write a word or a term or a phrase which can substitute the following statement.
The organisation which holds the securities in electronic mode.
State whether the following statement is true or false.
Depository system is very similar to banking system.
Select the correct option from the bracket.
| Group ‘A' | Group ‘B' |
| a) Dematerialization | 1) ____________ |
| b) ____________ | 2) DP |
| c) First depository of world | 3) ____________ |
| d) CDSL | 4) ____________ |
(1999, Agent of Depository, Germany, physical to electronic)
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Dematerialization ____________.
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| Group ‘A’ | Group ‘B’ |
| a) First depository in India | 1) ____________ |
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(12 digit code, NSDL, Electronic to physical, No distinctive number)
Answer in one sentence.
What is Depository System?
Correct the underlined word and rewrite the following sentence.
Allotment and Transfer of securities are time consuming in electronic mode.
Correct the underlined word and rewrite the following sentence.
Banking system leads to a scrip less capital market.
Correct the underlined word and rewrite the following sentence.
India has a single Depository system.
Explain the following term/concept.
Dematerialisation
State benefits of the depository to Investors.
India has a single depository system.
Justify the following statement.
Depository System has a very important role to play in the successful functioning of the capital market.
Explain the following term/concept:
Depository system
