Study the following case/situation and express your opinion.
Mr. Z holds 100 shares of Peculiar Co. Ltd. in Physical mode and wishes to convert the same in electronic mode :
- Mr. Z holds a Saving Bank Account with CFDH Bank Ltd. Can he deposit his shares in this account for Demat?
- What type of account is needed for the same?
- Is it the RBI which will be the custodian of shares of Mr. Z after demating?
- No, Mr. Z cannot deposit his shares in his bank account for demat.
- A demat account is required for converting physical shares into electronic holding.
- No, RBI will not be the custodian of the shares of Mr. Z. The depository i.e. NSDL or CDSL will be the custodian of shares of Mr. Z after demating.
Concept: Functioning of Depository System
Is there an error in this question or solution?