Q1. [2] § Who is a Depository Participant (DP)?
Depository Participants (DPs) open investor accounts, in which they hold the securities that they have bought in dematerialised form. Brokers and Banks offer DP services to investors. DPs help investors receive and deliver securities when they trade in them. While the investor level accounts in securities are held and maintained by the DP the company level accounts of securities issued is held and maintained by the depository. Who can be depository participants ? Mention two depositories in India.
Previously asked in CBSE board exam
2025 92 Q13
Generated by claude-sonnet-4-6 · 2026-06-15 07:07 · grounding rag
Model Answer
Depository Participants (DPs): According to SEBI regulations, three categories of entities can become DPs — Banks, Financial Institutions, and SEBI registered trading members.
Two Depositories in India:
- National Securities Depository Limited (NSDL)
- Central Depository Services (India) Limited (CDSL)
Source: Chapter 6 — Depository Participants and Depositories in India
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Explanation
- The question has two parts: (i) who can be DPs, and (ii) name two depositories. Address both clearly.
- Examiner expects all three categories of DPs to be named — missing one may cost half a mark.
- NSDL and CDSL are the only two depositories in India; both must be written in full.
- Keep the answer crisp — no elaboration needed for 2 marks.
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