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Dematerialisation
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Rematerialisation
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Meaning
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The process in which shares in the physical form are converted into
an electronic form is called dematerialisation of the shares.
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The process in which the shares in an electronic form are converted
again into physical form is called rematerialisation of shares.
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Account of the shares:
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On dematerialisation of shares, the account of the shares in
electronic form is maintained in the demat account by Depository Participant
(DP).
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On Rematerialisation of shares, the account of the shares in physical
form is maintained by the company.
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Conversion
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Shares are converted from original physical form into an electronic
form.
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Shares are converted from an electronic form again into physical
form.
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Option:
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Recently the SEBI made dematerialisation compulsory for those shares
and securities which are often traded on a large scale.
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The process of conversion of shares from the electronic form again
into the physical form is still optional and involuntary.
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Possession of Shares.
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Due to dematerialisation, the actual possession of shares and
security passes from the investor to DP.
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Due to rematerialisation actual possession of shares and security
passes from DP to the investor.
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Dematerialisation Rematerialisation
