Annual maintenance charges levied on debt securities held through basic services demat accounts will be revised from June 1, according to the Securities and Exchange Board of India.
The move is expected to further boost participation of retail investors in the debt market. Basic services demat account offers limited services at a lower cost for retail investors. "Based on representation received from market participants... it has been decided to revise the structure of charges for debt securities," the market regulator said in a circular.
For debt securities worth up to Rs 1 lakh held through basic services demat account, there would no annual maintenance charges. A maximum charge of Rs 100 would be levied if the value of holdings is above Rs 1 lakh and up to Rs 2 lakh.
The revised charges would be effective from June 1.
Currently, a uniform annual maintenance charge of Rs 100 is levied on securities worth over Rs 50,000 and up to Rs 2 lakh irrespective of type of holding.
There is no such charge for holdings valued up to Rs 50,000.
In 2012, the SEBI directed depository participants to make basic services demat accounts available for retail individual investors as part of efforts to reduce the cost of maintaining securities in demat accounts.
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