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Question
Justify the following statement.
Depository system is very similar to the banking system.
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Solution
- As a bank keeps the money safe. Similarly, a depository system keeps the securities safe.
- As in a bank, funds are held in accounts having unique numbers. Similarly, in a depository system, securities are held in accounts having unique IDs.
- Like a bank, there is no physical handling of securities during allotments, transfers, etc.
- In a bank, the transfer of funds between accounts is done. Similarly, in a depository system, the transfer of securities between accounts is done.
- Hence, depository system is very similar to the banking system.
RELATED QUESTIONS
Write notes on Importance of Depository system.
Select the correct answer from the options given below and rewrite the statement.
______ is the institute which facilitates electronic holding of securities.
Depository Act was passed in __________.
Write a word or a term or a phrase which can substitute the following statement.
This system allows faster and easier transfer of securities.
Write a word or a term or a phrase which can substitute the following statement.
The Agent of the Depository.
State whether the following statement is true or false.
Physical mode of holding securities is risky.
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)
Answer in one sentence.
What is Depository System?
Answer in one sentence.
Give examples of action termed as corporate action.
Correct the underlined word and rewrite the following sentence.
Electronic mode of holding securities is risky.
Correct the underlined word and rewrite the following sentence.
India has a single Depository system.
Explain the following term/concept.
Depository system
Explain any four advantages of a depository system to an investor.
Justify the following statement.
Depository provides easy and quicker transfer of shares.
Justify the following statement.
The depository system results in reduced time, cost, and efforts.
Give one word or phrase for the following sentence:
How securities are settled?
State benefits of the depository to Investors.
Justify the following statement.
Depository System has a very important role to play in the successful functioning of the capital market.
