Sebi eases process of securities credit to demat accounts from April 2

Markets regulator Sebi has streamlined the process of crediting securities to dematerialised accounts by doing away with the requirement of letter of confirmation, a move that will reduce the period of transfer of securities from 150 days to 30 days.

Markets regulator Sebi has streamlined the process of crediting securities to dematerialised accounts by doing away with the requirement of letter of confirmation, a move that will reduce the period of transfer of securities from 150 days to 30 days. In a circular issued on Friday, Sebi said presently listed companies and registrars to an issue and share transfer agents (RTAs) issue a letter of confirmation (LOC) to investors, which is submitted to the depository participant for credit of securities. This process generally takes around 150 days. To enhance investor convenience and reduce timelines and risks, the regulator has decided to do away with the requirement of issuance of LOC, the Securities and Exchange Board of India (Sebi) said. Under the revised framework, RTAs and listed companies will directly credit securities to the investors' demat accounts after carrying out due diligence. The change is expected to bring down the timeline for credit of securities from 150 days to 30 days and eliminate risks related to loss or misuse of LOCs, Sebi said. The revised framework will come into effect from April 2, 2026. Any LOC issued before this date may continue to be used by investors for dematerialisation within the prescribed timeline, it added. The markets watchdog said the initiative is aimed at improving ease of doing investments, enhancing operational efficiency and strengthening investor protection.

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