Distinguish between the following.
1. Dematerlization and Rematerlization
Process of converting Physical certificates of securities into electronic form.
It is the process of conversion of electronic form of securities into physical form.
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.
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.