A demat account, compulsory for stock investment and trading, holds all your security certificates in an electronic or dematerialised form. A demat account enables you to easily access your certificates when buying or selling them.
When you open a demat account, you get the services of a SEBI-regulated Depository Participant (DP). Each depository participant in India has registered with either of the two depositories in India.
These depositories are the National Securities Depository Limited (NSDL) and the Central Depository Services Limited (CDSL). Since there are multiple DPs, all have unique DP IDs that can help you easily identify them.
Read on to learn what a DP ID is, how it differs from client ID, what its uses are, and more.
Before knowing what a DP ID is, you must know what a depository participant or a DP is. Depository participants are the intermediary between the demat account holder and the depository, i.e., NSDL and CDSL.
Each depository participant has an 8-digit DP ID assigned by the depositories. This helps identify the DP and the demat account of the client. This is because the demat account number combines the depository participant identification number and the client's unique ID.
The demat account number is allotted to a trader on opening a new demat account.
This is a 16-character numeric or alphanumeric number that can help you identify your demat account.
On the other hand, a DP ID is an identification code for the depository participant or the demat service provider with whom you have the account. Similar to a bank code, such as the IFSC code, it helps identify the bank branch.
While all bank customers have the same IFSC code, their bank account numbers are different. Similarly, many people can have the same DP ID, but their demat account number is unique.
Once you know what a DP ID means in the context of a demat account, you must know its uses. Here are some key uses of the DP ID:
It helps identify the client and depository participant
It can help you identify your depository by checking your demat account number
It helps create a secure demat account number
To find your DP ID, look at the 16-digit demat account number on your welcome letter or by logging into your demat account. If CDSL is your depository, the first eight characters of your account number comprise the ID for the depository participant.
For instance, say your account number is 7531549824657395. In this case, your DP ID is 75315498, and your client ID is 24657395.
On the other hand, if your depository is NSDL, then your account number will be ‘IN’ followed by 14 digits. Here, IN and the next 6 digits make your DP ID. So, if your account number is IN74125896378945, then your DP ID is IN741258, and your client ID is 96378945.
With these facts in mind, you can easily find your DP ID in your demat account number. Remember, a demat account is necessary if you want to trade in stocks. If you do not have a demat account, open one instantly on Bajaj Markets.
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Your DP ID depends on the DP with whom you have the account. If your DP is NSDL, then your ID is IN and the next 6 digits of your demat account number. If it is CDSL, then the ID comprises the first 8 characters of your account number.
The DP ID refers to the first 8 digits of your account number, which represents your depository participant. So, any traders that have a demat account with your DP will have the same DP ID. On the other hand, the client ID comprises the last eight numbers, which is unique to you.
The demat account number is a 16-digit numeric or alphanumeric ID representing your ownership over the demat account and its securities. Your client ID comprises the last eight characters of your demat account number.
The code assigned by the National Securities Depository Limited (NSDL) has ‘IN’ in the beginning of, followed by a 14-digit numeric code.