The safety and security of a Demat Account concern investors as much as we worry about the authenticity of our savings account. If one has to put in simple words, online transactions and facilities are reliable and safe, but there are a few imminent threats. You can choose the best Depository Participant in the country and yet feel the need for looking after the security services of your accounts. The increasing cases of cybercrime and online fraud have been increasing lately, and it is your responsibility to safeguard your shareholdings from such threats. The money market has observed many fraudulent cases and incidents related to Demat Accounts, where the DP had nothing to do!
Yes, your DP can provide you with the optimum quality services, and you might still find yourself at the dangerous end if you do not follow the safety norms. Therefore, it is better to take some cautionary steps beforehand. Visit the website of your preferred services partner and get all the details regarding their facilities to know more about its safety guidelines. You should also follow a few common ways to keep your account safe and secure.
Always keep the security measures turned on to enjoy interrupted online services in the trade market.
Best Ways Ensure The Safety of Demat Accounts
There are several ways of maintaining the safety of your Demat Accounts while ensuring complete secretion of the online benefits. Yes, you can enjoy online trading benefits without compromising with the safety measures of your account.
#1 Keep an Updated Record of The Account Statements
All the transactions of a Demat ACcount can be viewed and reflected on using the account statements that you will receive from your DP. Some Depository Participants provide this service monthly or weekly, while some may also offer it daily.
- Go through your statement and check all the entries and the balance. Do not keep the statements unchecked for months to inspect it all together.
- If you check your account statements online whenever needed and do not avail the physical ones, try not missing out on any day.
- Make sure the type of shares, their number, and values are correct and true to your knowledge.
- Update your Depository Participant immediately if you find any flaws in the statement or if there is an error.
#2 Utilise The DIS Slip
The DIS (Debit Instruction Slip) booklet that you will receive is a vital document, and you must not misplace it or neglect it. It holds the same significance as your cheque book irrespective of the fact that you do not need it while using online services. Do not keep signed copies of this slip here and there or with your Depository Participant.
Some traders keep a signed DIS booklet with their broker to save time and effort in getting it signed at the time of transfer. You must not be in any such hurry to avoid the chances of fraud!
#3 Confine The Accessibility of PoA Document
The PoA (Power of Attorney) document is what you sign while opening the Demat Account. The brokers use the PoA to transfer, sell or buy shares in the absence of the entitled investor. If you have also hired a broker under you who has this right as per the PoA, you should add some clauses and limit the access that he can enjoy. In such a case, he will only be able to perform such actions after you give your consent for the same.
#4 Check The Background and Credibility of Your DP
Checking and verifying the credibility of your DP must be your primary point of concern while opening your Demat Account. Go through the company background, reviews and ratings before opening your account.
#5 Do Not Leave Your Account Without Freezing It
If you are travelling to another country for a few months or you want to stay inactive in the stock market for a while, the first thing you must do is freeze all your Demat Accounts. Some investors leave their accounts unchecked and open, making it easier for the fraudulent to access it.
Other Precautionary Measures For Complete Safety
- Always keep our DP updated about your current phone number and email address if you tend to change it frequently.
- Do not share your login ID and password with any other individuals.
- Do not use easy or common passwords that you have used in the past or use it for other social media handles.
- Keep changing your password frequently.
- Always go through the messages and updates that you receive from your DP so that you can get the information about unlikely activities immediately.
Online security and safety depend highly upon the way you use the services available. Persistent carelessness and negligence can cost you dearly in the long. So, while the duty and responsibility of maintaining safety lie on the shoulders of your service provider, you too have a part to play in it. Be a responsible investor and stay active while trading online!