Depository Participant (DP) charges are applicable to any sell transactions in your Demat Account. These charges are in addition to brokerage and are not included in the contract notes. Depositories and their participants get income via DP charges.
DP charges are a set transaction fee, regardless of the amount of shares sold. As a result, the charges are based on the number of shares sold rather than the total volume of shares sold. So, whether you sell one share or 100, the charges stay the same.
Who levies the DP charges?
DP charges are imposed by both depositories and depository participants. If the stock is part of the Nifty index, the tax is imposed by National Securities Depository Limited (NSDL). The tax is imposed by Central Depository Securities Limited if the stock is listed on the BSE (CSDL). A depository participant acts as a link between depositories and investors.
Account opening fee, yearly maintenance cost, custodian fee, and transaction fee are the four types of charges (or fees) that depository participants often levy for a instant demat account transaction.
Why are DP charges imposed?
A best broker for demat account must first become a depository participant before offering customers a Demat account. Furthermore, they must pay a membership fee of lakhs to NDSL or CDSL, as well as various additional fixed prices and advanced prepaid transaction charges. In order to recover these costs, the brokers impose an additional fee to their consumers.
The fees charged by depositories
The fees charged by depositories are the same for all sell transactions. The following are the charges:
CSDL charges Rs. 13 + Rs. 5.50 for demat transactions.
NSDL charges Rs. 13 + Rs. 4.50 for demat transactions.
It's important to keep in mind that, in addition to the depository costs, each broker has their own set of charges. If you're thinking about investing in the stock market, you should be aware of the various fees and charges that are share market trading app wile trading.