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Justify the following statement. Depository provides easy and quicker transfer of shares. - Secretarial Practice

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Question

Justify the following statement.

Depository provides easy and quicker transfer of shares.

Justify
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Solution

  1. Under the depository system, securities are held in electronic form.
  2. The transfer and settlement of securities are done electronically.
  3. The efforts that were required in filling transfer forms and lodging the documents are eliminated in the depository system.
  4. Processing time in the transfer of securities is reduced and neither the securities nor the cash is tied/held up for an unnecessarily long time.
  5. Further, stamp duty levied on the transfer of physical shares is also not applicable.
  6. Hence, the depository provides easy and quicker transfer of shares.
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Depository System
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Chapter 9: Depository System - Exercises [Page 142]
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