Start dematerializing your company’s
shares and securities

₹4,990 for initial setup

Who does this requirement apply to?

Since 27 October 2023, the Ministry of Corporate Affairs, Government of India, requires private limited companies to issue shares in dematerialized form, with a deadline of 30 June 2025.

Private limited companies

(except small companies*) incorporated in India.
A subsidiary of a body corporate is not considered a small company.

Shareholders and debenture holders

of private limited companies.
* Please note: A small company has paid-up capital of INR 4 crore or less and a turnover not exceeding INR 40 crore in the previous financial year.
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More important information

What is dematerialization of securities?

Dematerialization is the conversion of physical securities into electronic format, maintained by government-authorized depositories in India. Securities include shares, scrips, stocks, bonds, debentures, and similar marketable instruments.

What needs to be done?

For a private limited company that is a subsidiary of a foreign company:
  • Secure an International Security Identification Number (ISIN) for each type of security.
  • Ensure all shares are converted within the legal timelines.
For a security holder of a private limited company:
  • Open a demat account with an authorized depository within the legal timelines.
  • Convert existing securities into dematerialized form within the legal timelines.

What costs are involved in the process?

The mandate for dematerializing securities and shares in India involves multiple parties and costs, including setup fees, RTAs & Depositories charges, and transaction fees.
  • Initial setup fee: There is a charge for the initial setup or activation, which can vary depending on the service provider. LEI Register charges INR 4990
  • RTAs & Depositories fees: Additional charges by Registrars and Transfer Agents (RTAs) and Depositories for processing and maintaining the dematerialized securities. These fees are not included in the initial setup fee and are charged separately.
  • Annual maintenance charges: Annual fees charged by depository participants for maintaining the demat account. These fees can vary based on the depository participant and the volume of holdings.
  • Transaction fees: Fees for each transaction carried out in the demat account, such as transfers of shares or other securities.
  • Dematerialization request charges: Fees for processing the request to convert physical securities into electronic form.
  • Courier/postal charges: Costs associated with sending physical certificates to the depository participant for dematerialization.

What is the deadline of compliance?

The deadline for dematerialization is 30 June 2025.

What are the consequences of non-compliance?

If the company or security holders do not comply with the requirement to dematerialize their securities by 30 June 2025, the following consequences will apply:
  • The company will not be able to issue or allot any type of securities.
  • The security holder will not be able to transfer or subscribe to any type of security.
  • Monetary penalties:
    • On the company: INR 10,000 plus INR 1,000 for each day the violation continues, up to a maximum of INR 200,000.
    • On every officer in default: INR 10,000 plus INR 1,000 for each day the violation continues, up to a maximum of INR 50,000.

No share transfer or new issue is planned, why act now?

The Registrar of Companies (ROC) can easily monitor electronic data, making non-compliances quickly detectable and sanctionable. Sanctions consume effort and management time beyond the penalties.
Setting up a demat account takes time and depends on depository cooperation. Issuing or transferring shares might become necessary unexpectedly. It´s advisable to establish the structure now to avoid delays when urgent action is required.

Why choose WeeDoo Services

We offer fast, reliable, and secure services for your business needs. Our technology-driven approach simplifies data processing and ensures a streamlined experience.

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Rahul Jha
Rahul Jha
CEO of LEI Register Services

"Simplifying complex processes is our mission. We are committed to making our services fast, accessible, and easy to understand for everyone."