Quick checklist before you start

Keep these ready, so your application does not stall halfway:

PAN, linked with Aadhaar. An unlinked PAN can turn inoperative, and that holds up KYC.
Aadhaar linked to the mobile number you are using now, so OTP verification works
Identity and address proof (Aadhaar, driving licence, passport or voter ID)
Bank proof (cancelled cheque or a recent bank statement)
Photo and signature, as per the app instructions
Nominee name and relationship, or a decision to opt out
Income proof, only if you plan to trade in derivatives

What is a Demat Account?

A demat account holds securities such as shares, exchange-traded funds, bonds and mutual fund units in electronic form. Demat is short for dematerialised, which means your holdings sit as digital records instead of paper certificates.

You open it with a Depository Participant, or DP. A DP is a broker or bank registered with one of India’s two depositories.

NSDL, the National Securities Depository Limited, was set up in 1996. As of July 2026, it serviced about 4.6 crore demat accounts through a network of roughly 315 depository participants.
CDSL, the Central Depository Services Limited, was set up in 1999. As of July 2026, it serviced about 18.8 crore demat accounts through more than 580 depository participants.

Together, the two depositories held around 23.4 crore demat accounts in July 2026. That figure counts accounts, not people, because one investor can hold accounts with more than one broker.

SEBI regulates both depositories. If you want the basics in more depth first, read what is a demat account.

Types of Demat Accounts

Which type you get depends on your residential status and how your money moves.

Regular demat account. For resident individuals. It holds shares, ETFs, bonds, mutual fund units and other securities. Most first-time and long-term investors in India use this type.
Repatriable demat account. For Indians living abroad who want the option of sending money back overseas. It must be linked to an NRE bank account, and repatriation is subject to RBI rules.
Non-repatriable demat account. Also for Indians living abroad, but the money invested here cannot be freely sent overseas. It is linked to an NRO bank account, and is normally used for income earned in India such as rent, dividends or capital gains.

Who Can Open a Demat Account in India?

Resident individuals, with a valid PAN and an Indian bank account
Minors, through a guardian who operates the account until the child turns 18
Hindu Undivided Families (HUF), opened in the name of the Karta, the family member who manages the HUF
Companies, LLPs, partnership firms, trusts and societies, as non-individual accounts
Indians living abroad (NRIs), through repatriable or non-repatriable accounts
Clearing members, who settle trades on behalf of brokers and hold client securities in a pool account

Not every broker supports every category, so check the broker’s list before you start the form.

Documents Required to Open a Demat and Trading Account

The list is short, and the same documents cover both accounts when you open them together.

For online account opening

Keep clear soft copies of these:

PAN card, as identity proof
Address proof such as Aadhaar, voter ID, passport or driving licence
A passport-size photograph
A scanned copy of your signature
Bank proof such as a cancelled cheque, a passbook copy or a bank statement
Income proof, only if you want the derivatives segment

For income proof, brokers commonly accept a bank statement for the last six months, the latest income tax return, or salary slips for three months.

For offline account opening

If you apply on paper instead, you submit self-attested copies of the following:

The broker’s KYC form
PAN card, as identity proof
Address proof such as Aadhaar, driving licence, passport or ration card
Income proof, only if you want the derivatives segment
Bank proof showing the account number clearly, along with the MICR code and the IFSC code, which are the two codes banks use to route payments

Self-attested means you sign each copy yourself to confirm it is a true copy of the original.

One point that confuses beginners: income proof is not needed for plain equity investing. Most brokers ask for it only when you request access to futures and options.

Steps to Open a Demat Account

Step 1: Choose your depository participant

Pick a broker or bank that will act as your DP. Check that it is registered with SEBI, and look at its charge sheet, platform and support before you decide. This DP opens your demat account and links it to NSDL or CDSL.

Step 2: Fill in your basic details

Enter your name exactly as printed on your PAN, along with date of birth, address and occupation. Take a moment here. A wrong spelling or an incomplete address is one of the most common reasons applications get delayed.

Step 3: Upload your KYC documents

Most brokers ask for PAN, identity and address proof, a photo and a signature. Use clear images in good light, and make sure all four corners of the document are visible.

KYC is a one-time exercise across the securities market. If your KYC is already registered with a KYC Registration Agency through another SEBI-registered intermediary, this step is usually much shorter.

Step 4: Add and verify your bank details

Link the bank account you will use for adding funds and withdrawals. Brokers normally ask for a cancelled cheque or a recent bank statement to confirm the account belongs to you.

Step 5: Register a nominee or opt out

From now on, this is no longer something you can skip on a single-holder account. Keep the nominee’s name and relationship ready. The section below explains exactly what changed.

Step 6: Complete verification

You will complete OTP verification for your mobile number and email. Most brokers also run a short video verification, where you confirm your name and show your PAN on camera.

Step 7: Sign with Aadhaar and receive your demat number

Once everything is approved, your demat account is created, and you receive your demat ID:

CDSL: a 16-digit numeric BO ID
NSDL: a DP ID that starts with IN, followed by your Client ID

You will use this number for IPO applications, for tracking your holdings, and any time a form asks you to identify your demat account.

What is a Trading Account?

A trading account lets you place buy and sell orders on the exchanges through your broker. The demat account stores your securities. The trading account is the layer where the buying and selling actually happens, so you need both.

Steps To Open a Trading Account

Most brokers open the trading account alongside the demat account, in the same application.

Step 1: Choose the segments you want

Start with what you actually need. Most beginners begin with equity delivery. You can also enable intraday or F&O, but only if you understand the risk. Brokers often ask for income proof before activating derivatives.

Step 2: Fill in your trading profile

Enter occupation, income range and trading preferences. This helps the broker set up the right level of access.

Step 3: Link the trading account to your demat account

The link means that when you buy shares for delivery, they move into your demat holdings after settlement.

Step 4: Review the agreements and the charge sheet

Before you accept, look at brokerage per order, DP charges on delivery sells, and margin rules if you are enabling intraday or F&O.

Step 5: Set up login and security

Create your password or PIN and switch on two-factor authentication. Treat it like a bank login, and never share an OTP with anyone.

Step 6: Add funds and place a small first order

Transfer money from your linked bank account and place one small trade to learn the flow. A delivery buy shows up in your demat account after settlement. An intraday position is meant to be closed the same day.

Key Features of a Demat Account

Holds securities in electronic form, with no paper certificates to store
Shows all holdings in one view, listed by quantity and ISIN
Credits after settlement, and debits when you sell for delivery
Reflects corporate actions such as bonus issues, splits and rights entitlements
Credits dividends, interest and refunds to your linked bank account
Allows electronic transfer of securities instead of physical paperwork
Supports pledging of holdings, where the broker enables it
Allows freezing of the account, or of specific securities, in certain cases
Can be used to raise a loan against the securities held in it
Reduces the risk of certificates being lost, damaged or forged

Key Features of a Trading Account

Lets you place buy and sell orders on the exchanges through your broker
Shows open orders, executed trades and pending orders in one place
Supports order types such as market, limit and stop loss, depending on the platform
Displays intraday and other enabled segments as separate positions
Allows segment activation, so you switch on only what you need
Shows available funds and margin, which matters most for intraday and F&O
Generates contract notes and trade history, which help at tax time
Applies risk controls such as price bands and order limits, which vary by broker and exchange

Common Mistakes and Risks to Avoid

Details that do not match across documents. A PAN name that differs from your bank name is a frequent reason for rework.
Unclear document images. Poor lighting and cropped edges slow verification down more than anything else.
Enabling F&O too early. Derivatives involve leverage, and losses can run larger than beginners expect.
Comparing only the brokerage. AMC, DP charges and other fees show up later, and they often matter more than brokerage for a small portfolio.
Rushing the first trade. Start with a small delivery buy so you can watch order types, settlement and holdings behave.
Trusting links and sharing OTPs. New investors are a common scam target. Use the official app or website, and never share an OTP with anyone, including someone claiming to be from your broker.