A demat account is an expensive way of investing in mutual funds. Many demat operators charge around Rs 350 per year for opening a demat account. There are annual recurring charges of a similar amount (Rs 350).
If these amounts (assuming they are not increased) are invested in good direct mutual funds you could be making thousands of rupees more! About Rs 42,000 over say 20 years.
Even not considering such charges, a demat account is not necessary because the Registrar and Transfer Agencies (RTAs) and the Mutual Fund companies (also called Asset Management Companies or AMCs) maintain your unit holdings electronically. So there is no need to ‘dematerialise’ these units!
A good online platform can help you track your holdings across RTAs and AMCs thereby making the whole process paperless. So choose a good platform and
