Most people who open a demat account never think about converting their shares back to paper. That makes sense because demat is faster, safer, and the only format accepted for buying and selling on Indian stock exchanges. But the option to convert demat shares into physical certificates exists, and it is called rematerialisation.

This article covers what rematerialisation means, how it works, what the actual charges are, and when it is still relevant under current SEBI and MCA rules.

What Is Rematerialisation?

Rematerialisation is the process of converting shares held in a demat account into physical share certificates. The shares are removed from your demat account and reissued as paper documents.

It is handled through your Depository Participant and processed by the company’s Registrar and Transfer Agent. The depository involved is either NSDL or CDSL, depending on which one your demat account is linked to.

This is the reverse of dematerialisation, where physical certificates were converted into electronic form. Both processes exist within India’s depository framework.

What SEBI Says About Physical Shares

Before you consider rematerialisation, you need to understand what SEBI has ruled about physical shares.

SEBI amended Regulation 40 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Under this amendment, listed companies cannot accept requests to transfer securities held in physical form from April 1, 2019 onwards.

SEBI clarified in April 2019 that investors are still allowed to hold shares in physical form. However, any transfer of those shares requires them to be in demat form first.

What this means in practice:

You can still hold listed company shares as physical certificates.
You cannot transfer or sell them without converting back to demat.
Inheritance and transmission processes also require demat conversion before the transfer can be completed.

The MCA Rule 9B: What It Means for Private Company Shareholders

For shareholders of private companies, MCA introduced Rule 9B under the Companies (Prospectus and Allotment of Securities) Rules, 2014.

Under this rule, private companies other than small companies were required to dematerialise all their issued securities. The deadline was originally September 30, 2024, and was later extended to June 30, 2025.

Small companies, defined as those with paid-up capital below Rs. 10 crore and turnover below Rs. 100 crore as of December 1, 2025, are currently exempt.

This is important because the “rematerialisation is useful for unlisted or private company shares” argument that many blogs make is now significantly limited. Even private company shareholders are expected to hold securities in demat form under Rule 9B.

When Does Rematerialisation Still Make Sense?

Given these regulations, rematerialisation is useful in a narrow set of cases.

Holding shares of companies that are exempt from Rule 9B, such as qualified small companies.
Maintaining paper records for estate documentation purposes, where a physical certificate is needed alongside other documents.
Situations where the investor has a specific legal or administrative requirement for a physical certificate.
Long-term holdings where there is no intention to sell or transfer in the foreseeable future.

For everyone else, staying in demat form is the straightforward choice.

How Rematerialisation Works

The process runs through your Depository Participant and involves the depository and the company’s RTA.

Step 1: Fill the Rematerialisation Request Form
You submit the Rematerialisation Request Form, called the RRF, to your DP. The form asks for your client ID, DP ID, company name, ISIN, and the number of shares you want to convert. Each company or ISIN needs a separate RRF.

Step 2: DP blocks the shares
Your DP blocks the shares in your demat account and sends the RRF to NSDL or CDSL.

Step 3: Depository forwards to the RTA
The depository sends the verified request to the company’s Registrar and Transfer Agent.

Step 4: RTA processes and prints certificates
The RTA checks the holding details and prepares the physical share certificates.

Step 5: Certificates dispatched
The physical certificates are sent to your registered address by courier.

The total time from submission to receiving certificates is typically around 30 working days, though it can vary by company and RTA.

Rematerialisation Charges: Verified Figures

Charges vary between brokers and depositories. Here are the verified numbers.

NSDL charges to DPs:
Rs. 25 for every 100 securities or part thereof, subject to a maximum fee of Rs. 5,00,000 per request.

DP charges to investors (example from published schedules):
Rs. 50 per certificate plus Rs. 50 courier charges, inclusive of NSDL charges.

For commodity demat accounts under NSDL:
0.02% of the value, subject to a minimum of Rs. 75 per request.

GST:
Applicable at 18% on all service charges.

These are indicative figures. Each broker publishes its own tariff schedule, and the actual amount you pay depends on your DP. Always check your broker’s published charges before submitting the RRF.

A Realistic Example

Arjun holds 800 shares of a small private limited company that qualifies as a small company under the revised limits and is therefore exempt from Rule 9B. The company still issues paper certificates for its records, and Arjun needs a physical certificate for a legal process tied to a family estate.

He submits the RRF through his DP with the company name, ISIN, and share quantity. The DP blocks the shares and forwards the request to CDSL, which sends it to the RTA. After 28 working days, physical certificates arrive at his registered address.

Since the company is an exempt small company, the certificate holds a valid ownership value. If Arjun ever decides to sell or transfer these shares, he will need to dematerialise them again before any transaction can take place.

Rematerialisation vs Dematerialisation

Aspect	Dematerialisation	Rematerialisation
Direction of conversion	Physical to electronic	Electronic to physical
Processing time	7 to 15 working days	Around 30 working days
Can you trade after conversion	Yes, for listed shares	No, transfer requires demat first
SEBI restriction	None	Applies to listed company transfers from April 1, 2019
MCA Rule 9B impact	Applicable for private companies	Narrows the use case for private company shares
Best suited for	All investors	Specific exempted cases only

Advantages

Provides a physical ownership document for personal or legal records.
Useful for small private companies exempt from Rule 9B, where physical certificates hold operational value.
Can assist with certain estate documentation requirements.

Risks and Limitations

Physical certificates can be lost, damaged, or destroyed.
You cannot transfer or sell listed company shares in physical form under SEBI Regulation 40.
Getting shares back into demat form requires another dematerialisation process with additional time and charges.
Submission errors in the RRF, such as wrong ISIN or address, delay the entire process.
Physical certificates sent to an outdated registered address may be lost in transit.

Common Mistakes

Starting the process without a clear reason for needing a physical certificate.
Assuming physical certificates can be used for selling listed company shares.
Submitting a single RRF for shares across multiple companies. Each ISIN needs a separate form.
Not verifying that the registered address on the demat account is current before submitting.
Ignoring the charges and timeline involved.

Conclusion

Rematerialisation is a legitimate process within India’s depository system. It converts demat holdings into physical share certificates through your DP, NSDL or CDSL, and the company’s RTA.

Its practical use has narrowed considerably. SEBI banned physical transfers for listed company shares from April 1, 2019. MCA’s Rule 9B has pushed most private companies toward demat as well. Physical certificates are legally allowed as a form of holding, but they cannot be transferred or sold without converting back to demat.

Before submitting an RRF, ask whether the reason justifies the time, cost, and future inconvenience of holding shares outside demat form.