Home : Joining NSDL : As a DP
Procedure for becoming a Depository Participant
Eligible entities will be required to submit to NSDL, a duly filled in Questionnaire and two original sets of Form E as prescribed under SEBI (Depositories and Participants) Regulations, 1996 alongwith Additional Information Required by SEBI.
Alongwith application form, the applicant has to enclose the following:
- Board resolution authorising the applicant to make an application to NSDL to become a Participant (two original sets).
- Specimen signatures of the authorised officials, who will be acting on behalf of the applicant (two original sets).
- Certified true copy (bound copy) of the audited financial statements for last three years, alongwith the CARO report (two original sets).
- Networth Certificate (based on previous year’s audited financial statements) and computation sheet as per the format given in Annexure ‘A’ of Business Rules of NSDL (two original sets).
- Note on Business History (one set)
- Background and details of experience of promoters and directors
- Core business areas
- Form A dully filled in (one set).
- If applicant and affiliates/ subsidiaries of applicant are registered with the stock exchange as a member and/ or CDSL as a Participant, submit Conduct Certificate (status report) issued by stock exchange and/ or CDSL (two sets).
- If the status report contains remarks pertaining to pending dues, Investor Grievance case(s), Arbitration Case(s), Disciplinary action etc, submit the details and current status of the same alongwith the relevant supporting documents. In case there are any pending dues, fines/penalty etc. please confirm whether the same have been paid and submit the proof of the payment of the same.
- A demand draft/ banker’s cheque of Rs.25,000 and Rs. 15,000 favouring "National Securities Depository Limited" and “Securities and Exchange Board of India” towards Entry Fees and application fee respectively.
Subsequent to submission of application, NSDL will advise applicant to procure the necessary infrastructure as per NSDL specifications and to submit the Forms A1, B and C1.
- Applicant may order and install the following after confirmation from NSDL
- Telecommunication network equipment i.e. Multi Protocol
Label Switching (MPLS) or VSAT for connectivity with NSDL
[This is optional for NSE members who are already linked to NSE via VSAT].
- The applicant confirms installation of the requisite hardware, router & MPLS or VSAT equipment by submitting Form A1, B & C1 duly filled.
- If NSDL is satisfied with details given in Form B, a pre-activation inspection is conducted at the applicant’s office. After the pre-activation inspection, the application will be forwarded to SEBI.
- Applicant attends training conducted by NSDL covering all operational aspects of the depository system.
- Applicant should have at least one person who has qualified in NCFM (Depository Module)/ NCDO at the location(s) from where applicant proposes to carry out depository operations and ensure that this requirement is met at all times.
- The applicant forwards Form C1 duly filled to NSDL.
- The applicant installs the software in the test environment under the guidance of NSDL & forwards the checklists generated in the installation procedure.
- If checklists are okay, pilot testing will be commenced
- On receiving the in-principle approval from SEBI, the applicant pays the following fees to SEBI through NSDL within 15 days
Sr.No. Fees Amount (in Rs.) 1. Registration Fee 2,00,000 2. Annual Fee 1,000
- The applicant pays the following amounts to NSDL
Sr.No. Fees Amount (in Rs.) 1. Interest - free Security Deposit [refundable] 10,00,000 2. DPM Application Software Charges * # 40,000 3. Insurance Premium # 22,250 Total 10,62,250
* DPM application software charges of Rs.40,000 are per annum. Alternatively, the Participant has an option to pay one time charge of Rs.2,50,000.
# Note: Service Tax @ 12% + Education Cess @ 2% on Service Tax + Higher Education Cess @ 1 % on Service Tax is applicable on the DPM Application Software Charges, and Insurance Premium.
- SEBI grants a Certificate of Registration to the applicant.
- NSDL and the applicant sign Depository-Participant agreement.
- After completion of the above requirements, NSDL makes applicant operational in NSDL system and applicant may start its commercial operations as a Participant of NSDL.