23-Nov-2023
2 mins read
Central Depository Services (India) Limited (CDSL), a Mumbai-based depository services provider, witnessed a surge in its shares as it proudly announced surpassing the monumental milestone of over 10 crore registered demat accounts. In a significant feat, CDSL has become the first and only listed depository in India to achieve this remarkable figure.
What is CDSL?
Founded in 1999, CDSL plays a crucial role in facilitating the holding and transaction of securities in electronic form. Additionally, the company is instrumental in settling trades on various stock exchanges.
Understanding a Stock Depository
A depository serves as a crucial facilitator for holding securities in the dematerialized or demat form. In simpler terms, it acts as an enabler for secure and efficient security transactions.
The Role of CDSL and Services Offered by CDSL
Electronic Securities Transactions: CDSL stands out as the largest depository in the country in terms of more than 10 crore active demat accounts. It provides investors with the opportunity to deposit securities by opening an electronic account, thereby contributing to the dematerialization of financial instruments.
Extensive Service Network: With a robust infrastructure, CDSL’s 580-plus Depository Participants (DPs) serve the vast demat account holder base from over 20,000 locations, ensuring widespread accessibility and convenience for investors.
Diverse Subsidiaries: In addition to its primary role, CDSL extends its influence through various subsidiaries, offering a spectrum of financial services to intermediaries and the market.
Subsidiaries of CDSL
CDSL Ventures Ltd (CVL): A wholly-owned subsidiary of CDSL, CVL operates as a KYC registration agency. It played a pivotal role in conceptualizing, designing, and implementing the KYC registration system in collaboration with the mutual fund body AMFI for all mutual funds in 2008. Currently, CVL boasts more than 4.6 crore fully digitized KYC records.
CDSL Insurance Repository Ltd (CDSLIR): Functioning as a registered insurance repository (IR), CDSLIR manages data on insurance policies electronically on behalf of insurers, streamlining and modernizing the insurance sector.
CDSL Commodity Repository Ltd (CCRL): CCRL plays a crucial role in allowing entities like farmers, farmers’ producer organizations (FPOs), and manufacturers to obtain electronic warehouse receipts (negotiable or non-negotiable) in a demat account against commodities deposited in registered warehouses. This initiative enhances transparency and efficiency in commodity transactions.
In conclusion, CDSL’s achievement of surpassing 10 crore demat accounts signifies not only its individual success but also the growing interest and participation of investors in electronic securities transactions. The company, through its subsidiaries, continues to play a pivotal role in modernizing and streamlining various facets of the financial and insurance sectors. As CDSL maintains its momentum, it remains a key player in shaping the landscape of securities trading and depository services in India.