Required Documents for Trading Account Opening

Opening a trading account is a crucial step for anyone venturing into the world of financial markets. To initiate this process, certain essential documents are required to ensure compliance with regulatory norms and secure a seamless trading experience. Understanding the types of documents needed for opening a trading account is fundamental to the efficient and lawful operation of your investment endeavours.

Defining a Trading Account

A trading account is a financial account held by a brokerage firm that enables an individual or entity to buy and sell various financial instruments in the financial markets. It acts as an intermediary between the investor and the stock exchange, facilitating the execution of trades. The trading account allows users to engage in activities such as buying and selling stocks, bonds, commodities, currencies, and other financial instruments. It also serves as a record-keeping platform for monitoring transactions, managing investments, and assessing overall portfolio performance.

Benefits of Having a Trading Account

Having a trading account offers numerous advantages for individuals looking to participate in the financial markets.

• There is seamless online trading as physical securities are no longer traded.
• The cost of trading has been reduced due to the eradication of postal charges, stamp charges, etc.
• Liquidity has highly increased due to the reduced settlement period, which is T+2 days.
• The trading account provides a platform to trade across multiple exchanges and asset types.
• One can easily stay updated regarding the stock market as they get updated information regularly.
• Multiple strategies and investments can be planned and implemented at the same time.

Required Documents to Open a Trading Account with Share India

Share India provides a state-of-the-art trading account that can be opened easily. It starts with you sharing your contact details, followed by filling up all the necessary details required to open a trading account. In the next step, you’ll need to submit the required documents and complete the whole step in the final step by completing your e-sign. Below is the list of documents that are needed, together with their purpose.

Proof of Identity (POI)

Proof of identity is a must to verify who you are. Identification cards issued by government organisations are generally acceptable. Here’s a list of the widely accepted POIs that you can provide:

• PAN card
• Aadhaar card
• Voter ID
• Driving license

Proof of Address

There are two proofs of address that you might have to submit if your permanent address and correspondence address are different. Only one proof is required if they are the same. Here’s a list of documents accepted as address proof:

• Passport
• Aadhaar card
• Ration card
• Voter ID
• Driving license
• Rent agreement
• Registered lease
• Residence purchase agreement
• Bank account statement or passbook
• Utility bills like electricity bill, gas bill, water bill etc.
• A POI consisting of addresses is also accepted as address proof
• Apart from this, proof of address can be issued by bank managers of scheduled commercial banks, scheduled cooperative banks, multinational foreign banks, gazette officers, notary public, elected representatives to the legislative assembly (MLA), members of parliament (MP), any Government or statutory authority, etc.
• In the special case where you’re married, your spouse’s proof of address is accepted

Proof of Income

One must share proof of income, especially from trading in the futures and options segment. This is done to verify income. The documents that you can submit are:

• Copy of income tax return (ITR) shared with the Income Tax Department
• Salary slip from the last month
• Bank statement for the last six months
• Copy of annual income slip audited by a chartered accountant
• Net worth certificate
• Demat account holding statement with depository participant

Apart from these, other relevant documents substantiating ownership of assets by way of a self-declaration with relevant supporting documents can also be submitted.

Proof of Bank Account

For trading purposes, one must provide proof of their bank account, especially if they wish to trade in futures and options, or commodities. Here is the list of documents for proof of a bank account:

• Bank passbook along with the IFSC code of the bank
• Cancelled cheque. Ensure that the cancelled cheque has your name above your signature, and the name must be clearly visible. These documents will be used to link your bank account to your trading account.

Document Attestation

Certain documents for trading accounts need to be attested before they are submitted to the stockbroker. Not everyone can attest to these documents. Here’s a list of the people authorised to attest your documents:

• Notary public
• Gazetted officer
• Manager of a scheduled commercial/cooperative bank or multinational foreign banks

If you’re an NRI, you’ll have to get your documents attested overseas. Here’s the list of individuals who can attest documents for an NRI:

• Authorised officials of overseas branches of scheduled commercial banks registered in India
• Notary public
• Court magistrate
• Judge
• Indian Embassy
• Consulate general

They’re permitted to attest documents and must be from the country where the NRI resides and wishes to open a trading account. Trade with confidence once you’ve mastered the basics with our demo trading account.

Conclusion

The process of opening a trading account with Share India is extremely simple and can be carried out in minutes. The process becomes even quicker if you’re aware of the documents with which you need to open a trading account. Open an account with Share India today and start investing to grow and multiply your way to financial freedom.

Frequently Asked Questions (FAQs)