NSDL has no restriction on type of instruments that can be admitted in the depository. Instruments like Bonds, Debentures, Commercial Papers, Certificate of Deposit, etc. irrespective whether these instruments are listed/unlisted/privately placed or even issued to a single holder can be dematerialized.
As per NSDL Circular No. NSDL/CIR/II/18/2017 dated September 1, 2017, NSDL charges an annual fee at the rate of Rs.11/- per folio (ISIN position) in NSDL system, subject to a minimum amount as mentioned below as applicable:
|Nominal Value of securities admitted (Rs.)||Amount (Rs.)|
|Upto 5 crore||9,000|
|Above 5 crore and upto 10 crore||22,500|
|Above 10 crore and upto 20 crore||45,000|
|Above 20 crore||75,000|
Company has to send a request to NSDL detailing type of instrument alongwith a Letter of Intent. On receipt of request, a tripartite agreement will be signed between NSDL, Issuer and Registrar & Transfer Agent. Ones admitted, these securities would be made available for dematerialisation by NSDL.
No. The same terms and conditions of the existing bipartite/tripartite agreement will be applicable for the debt instruments. The Issuer has to provide a confirmation on the same to NSDL before admitting the securities.
Each instrument will be identified separately in NSDL system through a unique code called ISIN. Description of each instrument will be communicated to all the DP and Issuers on activation.
Unique characteristic of each instrument will be incorporated in the company and security descriptor in NSDL system. The coupon rate and the date/year of maturity are a part of the standard descriptor. This will enable both Investors and the Depository Participants to easily identify these instruments.
Any new instrument can be issued directly in dematerialized form without recourse to printing of either Letter of Allotment or Certificates. Securities will be directly credited into the accounts of the investor by NSDL on receipt of allotment details from Issuer/Registrar & Transfer Agent.
Letter of allotment (LOA) issued to investors prior to issue of debenture certificates can be issued in demat form. On creation of charge, the issuer will have to submit the corporate action information form for conversion of LOA to Debentures/ Bonds and the description of the security will be changed in the system to reflect the conversion.
Yes, the Issuer has to pay the relevant stamp duty as applicable irrespective whether it is issued in either physical or demat form. As per the Finance Act 2000, stamp duty is waived only for transfers within the depository.
One way of handling of redemption in dematerialised form is through transfer of all balance under the instrument (i.e. ISIN) to a demat account opened by issuer for the purpose. Prior to the date of redemption, the issuer has to complete all formalities associated with redemption in physical form. On the day of redemption, a debit-credit action will be undertaken wherein all balances under the instrument will be transferred to say, an Issuer Redemption Account. Alternatively, on receipt of information regarding completion of statutory requirements for redemption, ISIN will be deactivated in NSDL.
Interest payment for debt instruments will be handled in the same way as corporate benefits are handled for equity. On communication of record date by the Issuer, beneficiary position will be downloaded to the Issuer/Registrar by NSDL. In addition to the above statutory requirement, NSDL provides weekly download of beneficiary position to all Issuer/Registrar.
Exercising of call/put option only prepones the redemption date of an instrument. On exercising call option by the company, the same procedure will be followed as in normal redemption. For put option, once the same is exercised by all/part of the investors, the details of which is communicated by the Issuer a debit action will be carried out by NSDL for those accounts of the investors.
It depends upon the convenience of investor whether one wants to open a separate account for debt instruments. NSDL has no restriction if existing account or multiple accounts are used for dematerialisation of debt instruments.
Procedure for dematerialisation of debt instrument is same as that carried out for equity shares. In order to dematerialise his/her certificates; an investor will have to first open an account with a DP and then request for the dematerialisation of certificates by filling up a dematerialisation request form [DRF], which is available with DP and submitting the same alongwith the physical certificates. The investor has to ensure that before the certificates are handed over to the DP for demat, he marks "submitted for dematerialisation" on the face of the certificates.
No. Single statement of holding will reflect all holdings in a particular account irrespective of type of instrument. Along with Statement of Holding, the DP's will also provide periodically each client with a Statement of Transaction giving the details of all transaction during the period under each depository account.
Procedure involved for delivery or receipt of debt instrument will be same as involved for equity shares.
NSDL does not charge any fee for dematerialisation of certificates from depository participants. DPs are free to charge any charges towards dematerialisation from its clients. A detailed fee structure charged by NSDL from DP's is provided in the Fee Structure Schedule.
Payment of interest is handled in the same way as corporate benefit like dividend in equity. List of beneficiary holders as on book closure date consisting of Holder Name and account number, address, bank details and DP ID is downloaded to the Issuer. Based on the information provided above, the issuer despatches interest warrants to the holders of dematerialised instruments.
On exercising put option by an investor, a debit corporate action will be carried by NSDL where the balance under the instrument is reduced to zero. The details of put option exercised by investors will be provided by the company to NSDL.
Procedure followed will be identical to that followed for direct credit of equity shares during IPO/Bonus/Rights. The issuer will provide an option for allotment of securities in demat form in its issue prospectus. Investors opting for demat will have to provide demat account number alongwith DP ID in their application form. On being allotted, a direct credit will be carried out in accounts of the allottees.