Market regulator Securities and Exchange Board of India (SEBI) has further relaxed the rules governing Basic Services Demat Accounts (BSDA) to make investing more affordable for retail investors and to simplify compliance for depository participants (DPs). BSDAs are designed to offer significantly lower annual maintenance charges compared to regular demat accounts.
In a circular issued on Wednesday, SEBI announced that Zero Coupon Zero Principal (ZCZP) bonds and delisted securities will no longer be considered while calculating the value threshold for BSDA eligibility. The decision follows feedback received on SEBI’s earlier circular issued in June 2024.
SEBI said the move is aimed at providing “ease of doing business to depository participants and ease of doing investments for investors,” noting that ZCZP bonds and delisted securities often lack liquidity, price discovery, and active trading.
Under the revised norms, illiquid securities will be valued at their last closing price for BSDA threshold calculations. However, suspended securities, delisted securities, and ZCZP bonds will be fully excluded from valuation for determining BSDA eligibility.
To ensure ongoing compliance, SEBI has also mandated that depository participants reassess BSDA eligibility on a quarterly basis, replacing the earlier, less frequent reviews.
The regulator further clarified that eligible demat accounts must be converted into BSDAs by default, unless investors explicitly opt to continue with a regular demat account through a verifiable consent mechanism. This makes BSDA the default option for eligible retail investors.
The revised framework will come into effect from March 31, 2026. SEBI has directed depositories to amend their bye-laws, inform depository participants, and implement the necessary systems within 90 days after adequate user testing.
About BSDA Charges:
Under the Basic Services Demat Account framework:
- Holdings up to ₹4 lakh: Zero annual maintenance charges
- Holdings above ₹4 lakh and up to ₹10 lakh: ₹25 per quarter + 18% GST
- Holdings above ₹10 lakh: ₹75 per quarter + 18% GST
The eligibility threshold for BSDA was earlier raised from ₹2 lakh to ₹10 lakh, effective September 1, 2024.
Disclaimer:
This article is for informational purposes only and is based on SEBI circulars and regulatory disclosures. Investors should refer to official SEBI notifications and consult financial advisors before making investment decisions.
