Mandatory KYC Attributes for Demat Account

In the Indian securities market, a demat (dematerialised) account is required for holding shares and other securities in electronic format. To open or maintain a demat account, it is compulsory to comply with Know Your Customer (KYC) requirements. These KYC norms, laid down by the Securities and Exchange Board of India (SEBI) and implemented via depositories like NSDL and CDSL, help authenticate the identity of investors and prevent fraudulent activities. This article outlines the six mandatory KYC attributes, explains how to submit or update them, and guides you through e-KYC options.

KYC is a mandatory process through which financial institutions, including depositories and brokers, verify the identity, address, and financial credentials of an individual. For demat accounts, KYC is not only required during account opening but must also be periodically updated to remain compliant with SEBI regulations. Non-compliance may result in account restrictions.

Who mandates KYC

KYC requirements are enforced by SEBI and implemented through the depositories — NSDL (National Securities Depository Limited) and CDSL (Central Depository Services Limited). All depository participants (DPs) must ensure that their clients' KYC details are up to date, as per SEBI circulars.

How KYC protects investors

Accurate KYC data helps establish accountability, prevents unauthorised account activity, supports investigations in case of disputes, and ensures transparency in the financial ecosystem. It acts as a safeguard against identity theft and fraudulent transactions.

As per SEBI guidelines, six core KYC attributes must be submitted and verified to activate or continue operations on a demat account. Here are the mandatory details:

Permanent account number (PAN)

PAN serves as the primary tax identifier and links all financial transactions. It is a non-negotiable requirement for opening a demat account.

Aadhaar number

Aadhaar is used for identity confirmation and facilitates OTP-based e-KYC. It is also used to match demographic data with official records.

Date of birth

Your date of birth must match with proof documents like PAN and Aadhaar. This information helps in verifying identity and age eligibility.

Bank account details

Providing a valid bank account ensures seamless settlement of transactions. Details include account number, IFSC code, bank name, and branch.

Address proof

Valid documents for address proof include Aadhaar card, passport, voter ID, utility bills, and driver’s licence. This confirms your current residence.

Mobile number and email

Your contact details are essential for receiving OTPs, transaction alerts, and demat account updates. They must be linked and verified.

With advancements in fintech, e-KYC options have enabled individuals to complete their KYC remotely and swiftly. These include OTP-based Aadhaar verification and video KYC.

OTP-based Aadhaar e-KYC

You can initiate e-KYC using your Aadhaar number. Once entered, an OTP is sent to the Aadhaar-registered mobile number. Upon entering the OTP, your demographic information is pulled from UIDAI and verified.

Video-based KYC (VB-KYC)

VB-KYC requires the user to join a live video call with a KYC officer. During the session, the user must display their PAN card and respond to questions. The process is recorded and verified before approval.

If your details change (e.g., you change your address, phone number, or bank), it’s crucial to update your KYC. Most brokers and DPs offer an online process:

1. Log in to the broker’s portal
   

2. Navigate to the ‘KYC Update’ section
   

3. Upload relevant proof documents
   

4. Submit the request for verification
   

5. Receive confirmation once changes are approved
   

Not updating these details may result in restrictions on trading or account access.

The following are the typical problems that occur during KYC submission and how to resolve them.

• Mismatch in documents: Ensure all details (name, DOB) match across PAN, Aadhaar, and other documents.
  

• Invalid OTP: Use your Aadhaar-linked number and try resending the OTP.
  

• Technical glitches: Clear cache or use a different browser/device for the e-KYC portal.
  

• Mobile/email not linked: Submit a correction request through your DP.

 

These simple habits could ensure that your KYC information remains accurate and up to date.

• Always inform your DP if any personal information changes.
  

• Review your KYC annually even if there are no changes.
  

• Store digital copies of KYC documents in encrypted folders.
  

• Prefer e-KYC routes for faster processing and convenience.
  

Keeping your demat account’s KYC attributes updated is not just a regulatory formality — it is a critical step in ensuring your investments are secure, your transactions are seamless, and your access to market services is uninterrupted. With digital tools like OTP-based and video KYC, maintaining compliance has never been more convenient. By staying proactive with your KYC updates, you avoid unnecessary disruptions and ensure a smooth investing experience.

This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.