Advertisements
Advertisements
Question
Justify the following statement.
The depository system results in reduced time, cost, and efforts.
Advertisements
Solution
- Under the depository system, securities are held in electronic form.
- The transfer and settlement of securities are done electronically.
- The efforts that were required in filling transfer forms and lodging the documents are eliminated in the depository system.
- 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.
- Further, stamp duty levied on the transfer of physical shares is also not applicable. So, the cost involved is also eliminated.
- Even at the company end, costs, efforts, and time involved in printing and distribution of certificates in cases of new issues, bonuses, transfers, etc. are saved.
- Thus, the depository system results in reduced time, cost, and efforts.
APPEARS IN
RELATED QUESTIONS
Select the correct answer from the options given below and rewrite the statement.
India has a ______ depository system.
Match the pairs.
| Group ‘A' | Group ‘B' |
| a) Bad Delivery | 1) 1956 |
| b) Depository Act | 2) A 12 digit number/code. |
| c) ISIN | 3) Connects Government and Bank. |
| d) Depository participant | 4) Second Depository in India. |
| e) CDSL | 5) The Issuer Company. |
| f) Depository | 6) Problem faced in physical mode. |
| g) Beneficial owner | 7) A 10 digit number/code. |
| 8) Connects Depository and Investor. | |
| 9) First Depository in the world. | |
| 10) Coustodian of securities in electronic form. | |
| 11) Problem faced in electronic mode. | |
| 12) 1996 | |
| 13) Government Organisation. | |
| 14) The Investor. |
State whether the following statement is true or false.
A Bank can work as a DP.
Find the odd one.
Find the odd one.
Find the odd one.
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)
Select the correct option from the bracket.
| Group ‘A’ | Group ‘B’ |
| a) First depository in India | 1) ____________ |
| b) ____________ | 2) Rematerialisation |
| c) Fungibility | 3) ____________ |
| d) ____________ | 4) ISIN |
(12 digit code, NSDL, Electronic to physical, No distinctive number)
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.
Banking system leads to a scrip less capital market.
Explain the following term/concept.
Depository system
Explain any four advantages of a depository system to an investor.
Explain four advantages of Depository system to the Company.
Give one word or phrase for the following sentence:
How securities are settled?
State benefits of the depository to Investors.
India has a single depository system.
Explain any four advantages of depository system to the company.
