Distinguish between the following.

Points

Dematerialization

Rematerialization

1. Meaning

Process of converting Physical certificates of securities into electronic form.

It is the process of conversion of electronic form of securities into physical form.

2. Conversion

Here, the paper form of securities is converted in to digitally/ electronically held securities.

Here, the electronic records are converted into  physical/paper form securities.

3. Use of Form

It uses ‘DRF’ : Viz. ‘Dematerialization Request Form’ from Investor to the DP.

It uses ‘RRF’ : viz Rematerialization Request Form’ from Investor to the DP.

4. Sequence

This is an initial process. It is a primary and Principal function of the depository.

This is a reverse process. It is a secondary and supporting function of depository. Already demated securities are remated.

5. Identification of Securities

Demated securities have no distinctive numbers. They are fungible.

Remated securities will have certificate and distinctive numbers as issued by company.

6. Securities Maintenance Authority

Depository is the custodian of securities and records.

The issuing company is the record keeping authority. Securities are maintained by the investor.

7. Difficulty of Process

Demat is an easy process. Also its not a time consuming process.

Remat is not only a time consuming but also a complex process.