10 Best Demat Account in India – What is a Trading Account?

best demat account in india

There is no doubt that the stock markets provide an excellent opportunity to build wealth. 

That’s because you can create a portfolio of some of the best stocks and Exchange Traded Funds for your future. 

Or make profits every day with Inter-Day and Intraday trading on stocks, Exchange Traded Funds (ETFs), commodities, and currencies. 

Or you can simply buy government bonds and debentures to add to your portfolio.

What is Trading Account and Demat Account?

However, to build wealth with stocks, ETFs, and commodities or currencies, you’ll require something known as a Demat and Trading account. 

Thankfully, we have dozens of such Demat and Trading accounts available from some of the topmost stockbrokers and Non-Banking Financial Institutions in India.

Each of these Demat and Trading accounts offers some unique features. And this can prove confusing when you are a fresher or newbie and looking for the top Demat and Trading account to start building wealth.

Therefore, in this article, I am not only going to tell you the difference between Demat and Trading account but also provide you with the list of the 10 best Demat Account in India.

This list is a result of my extensive research in this field. For your convenience, I’ve included both Demat and Trading accounts from full-service brokerages and discount brokerages.

10 Best Demat Account and Trading Account in India 2021

Here I’m listing 10 best Demat Accounts in India. For your convenience, I’m listing both, best discount brokerages as well as full-service brokerages from where you can avail a Demat and Trading account.

Discount Brokerages

Discount Brokerages offer only basic services such as buying and selling stocks, ETFs, Mutual Funds, debentures, bonds, and derivatives, among other financial instruments. 

They offer only a trading platform and a Demat account to maintain your holdings. Discount brokerages are ideal for persons that have enough experience in stocks and commodities trading.

1. Paytm Money

Paytm Money is the Best Demat Account in India. It operates as an app only. Meaning, they don’t have a web-based version, unlike other brokerages. 

This is a discount brokerage.  Over 10 million people use Paytm Money to invest in stocks, Exchange Traded Funds, bonds, and debentures, among other financial instruments. 

Opening a Paytm Money account is free. They charge Rs.10 per sell transaction since this is a discount brokerage app. Stock and ETF deliveries are free.

You can start your investment journey with as little as Rs.100 on Paytm Money. It’s easy to buy and sell stocks and ETFs on Paytm Money. 

They also have the Futures and Options feature, if you’re interested in Intraday trading. You can link your Paytm mobile wallet or Paytm Payments Bank account to this Demat and Trading Account. 

Or you could transfer funds from accounts at other banks to buy stocks. They also have an option to invest in Initial Public Offerings.

2. 5Paisa

With more than seven million Indians using 5Paisa Demat and Trading Account, it ranks as the second-largest in India and incidentally, also the most popular. 

5Paisa Demat and Trading account are accessible in two ways. Either through their web-based platform that you could access on a computer or as an app. 

5Paisa is offered by India Infoline Ltd, a top Non-Banking Financial Company. What makes 5Paisa a very popular Demat and Trading account are its very low charges. 

You pay only Rs.20 for an Intraday trade which includes buying and selling. Deliveries on 5Paisa are free. 

The company charges a startup fee of Rs.750 to set up your Demat and Trading account. Being a discount brokerage, they provide limited services only. 

5Paisa also enables you to subscribe to IPOs and New Fund Offers of Exchange Traded Funds directly. You can link any bank account with your 5Paisa Demat and Trading Account.

3. Zerodha Kite

Another amazing discount brokerage that’s rapidly growing in India is Zerodha. They have a very simple yet practical and user-friendly Demat and Trading account known as Zerodha Kite. 

They have over six million users. Additionally, Zerodha Kite is also available as an app that you can use from your smartphone. 

Zerodha charges Rs.500 for a full account for stocks, commodities, and currencies trading.

It’s very simple to open a Demat and Trading Account with Zerodha. All you have to do is visit their website and click on the link for account opening. 

The electronic Central Know Your Customer and digital signature processes mean your Demat and Trading account will be ready to use in just two days, though it can take a little bit longer over weekends. 

An Intraday trade on Zerodha Kite is charged at Rs.20 only. You can subscribe to IPOs and bonds, debentures, and other instruments through Zerodha Kite.

4. Upstox

Ranking at No-4 on my list is Upstox, a stock trading platform that comes as a joint venture between Ratan Tata, the renowned Indian industrialist, and Tiger Global, an NBFC. 

Upstox Demat and Trading account has over four million users across India. You can use the web portal of Upstox or download and use their eponymous app to buy, sell and trade in stocks, ETFs, commodities, and currencies, among others. 

Upstox is free to join. They charge Rs.25 plus an 18 percent Goods and Services Tax (GST) as their monthly Demat and Trading account maintenance fee.

Each Intraday transaction on Upstox costs Rs.20, though stock, ETF, and other instrument deliveries are free. 

They also have a feature to apply for IPOs, bonds, and debentures, Future Fund Offers of ETFs, and New Fund Offers of Mutual Funds.

5. Angel Broking

Another best Trading account in India from where you can avail a very modern Demat and Trading account is Angel Broking. 

They have over 1.45 million users in India and are billed as the fastest-growing stocks brokerage in this country. Angel Broking charges Rs.500 to open a Demat and Trading account. .

And they charge Rs.20 per Intraday trade. Angel Broking also operates through two platforms- a web-based one and an app.

One of the best parts of Angel Broking is the freebies they offer for newcomers. 

You can avail yourself of free Intraday trading for a period of 30 days from the date your Demat and Trading account is activated. 

Additionally, they also have a feature of completing your CKYC procedures online. This makes it very easy to open a Demat and Trading Account with Angel Broking.

Full-Service Brokerages

Full-Service brokerages and their Demat and Trading accounts are best for newcomers or freshers or those who wish to learn stock trading and build wealth. 

That’s because full-service Demat and Trading accounts come with a host of benefits such as expert advice on stocks to buy, sell and hold, Intraday trading, and commodities positions. 

Here’s my list of the top five full-service brokerages.

1. ICICI 3-in-1

ICICI 3-in-1 is one of the best brokerage accounts in India. It has over five million users. 

The ICICI 3-in-1 gets its name from the fact that it consists of three different features: a savings bank account, a Demat account, and a Trading account. 

This makes it easier for a person to buy stocks by using funds that are lying in their ICICI Bank savings account, without the need for transfers from any other source.

You can opt to open an ICICI Bank 3-in-1 account when opening an ordinary savings account at the bank. 

They are a full-service brokerage. Hence, you can get a lot of features such as free advisory, instant cash credits, and instant liquidity within just 30 minutes of selling your stocks. 

When you open an ICICI 3-in-1 account, you get a free course on wealth building. The course is worth Rs.5,000. 

You also get commission-free trading worth Rs.500 and another course on stock trading worth Rs.1,599.

2. DigiDemat

DigiDemat from HDFC is ranked as the best full-service brokerage Account in India. They have over 2.6 million active users. This Demat and Trading account comes from HDFC Securities Ltd. 

DigiDemat uses high technology for stock trading, which makes it easier for you to trade and invest in stocks, ETFs, and other financial instruments.

There are over 2.6 million users of DigiDemat accounts across India. Opening a DigiDemat account is free of cost.

However, as full-service brokers, they charge fees for all transactions. You can refer to their schedule of fees to find charges. 

However, paying these fees is worth the money because you get excellent advisory services to invest in stocks, ETFs, and other financial instruments from HDFC Securities' own panel of investment experts. 

That way, you’re assured your money is invested in the right instruments.

3. Reliance Smart Money

Reliance Smart Money entered the Demat and Trading account scene about three years ago. 

This is one of the fastest-growing stock brokerages in India and comes from Reliance Securities, a top Indian NBFC. 

By mid-2021, Reliance Smart Money had over 1.25 million customers. They have various salient features such as Robo Advisor.

You can avail of two different plans from Reliance Smart Money. The first is the R-Account Insta Online Plan and the other, the R-Fixed Plan. 

Charges for trading and investments, deliveries, and Futures and Options differ according to your plan. 

This is a very advanced online Demat and Trading platform, which is very simple to use due to the latest technology it uses.

4. Kotak Securities

Kotak Securities Demat and Trading account is very popular in India, thanks to its links with the Kotak Mahindra Bank. 

You don’t need an account at Kotak Mahindra Bank to open a Demat and Trading Account with Kotak Securities. 

However, having one such savings bank account helps because you can trade faster with Kotak Securities Demat and Trading Account.

In recent months, Kotak Securities has lowered its rates to bring them at par with discount brokerages, in some instances. 

However, Kotak Securities provides a full-service brokerage despite such low rates. You can open a Demat and Trading account free of cost at Kotak Securities. 

However, I suggest you read their schedule of charges such as Annual Maintenance Fee and commissions on Intraday trades.

5. Sharekhan

Sharekhan is a Demat and Trading account offered by French bank and financial group, BNP Paribas in India. 

This is one of the pioneers of Demat and Trading accounts in India. Sharekhan is a full-service brokerage but their charges are somewhat at par with discount brokerages in some trades. 

You can easily set up a Demat and Trading Account with Sharekhan in less than 10 minutes.

Other than stocks and IPOs, ETFs, and FFOs, you can also use the Sharekhan Demat and Trading account to buy and sell Mutual Funds, debentures, and government bonds. 

Sharekhan console is very easy to use and hence, even a newbie that requires a full-service brokerage can manage stock trading easily over this platform. 

Opening a Demat and Trading account on Sharekhan is free, though you’ll have to pay annual Account Maintenance Charges.

Reasons to Hold a Demat and Trading Account

In 1996, the Indian government made it compulsory for all stockbroking companies and investors to hold their investments in “dematerialized” or electronic form. 

This was due to the growing popularity of the Internet and since holding stocks and other financial instruments electronically provides enough security. 

Prior to 1996, you had to hold stocks in the form of bulky paper certificates.

Furthermore, it wasn’t possible for ordinary citizens to call up or visit stockbrokers daily to place orders for stocks they want to buy or sell or trade. 

Hence, the online Demat and Trading accounts were introduced by Indian and foreign NBFCs in this country.

Difference Between Demat and Trading Account

Under current rules of the Indian government and the Securities and Exchange Board of India (SEBI), you cannot hold stocks, ETFs, Mutual Funds, Bonds, and Debentures in the form of certificates except in very extreme cases. 

All these have to be held on your Demat and Trading account only. Hence, for stock and commodities trading among others, you need a Demat and Trading account.

Some banks also offer only a Demat account. This means you cannot trade on the stock market. 

Instead, you can only hold stocks, ETFs, and other financial instruments for which you place orders physically.

A Demat account is like your treasure chest. Here you can store whatever stocks, ETFs, Mutual Funds, and other financial instruments you buy. 

The Trading account is like your store: you can buy or sell any stocks and other financial instruments. 

Every time you buy a stock, ETF, or other instruments, they’ll be held in the Demat account, till you sell them or trade them using the Trading account.

In Conclusion

You can also download apps of these Demat and Trading accounts to invest or trade in stocks and other financial instruments while on the move or if you don’t have access to a computer for any reason. 

However, it’s worth remembering that features on apps of these Demat and Trading accounts are fairly limited when compared to their web-based consoles. 

Make sure that the Demat and Trading account you’ll subscribe to is Two Factor Verification (2FA) because that protects it from illegal access and hacking. 

You can decide whether to opt for a discount brokerage or a full-service Demat and Trading account based on your experience in stock trading and personal needs. 

These top 10 Demat and Trading accounts I mentioned above are the best choice in India.

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