National Securities Depository Limited (NSDL) is the central depository in India that holds and maintains securities in electronic form.
NSDL ensures the smooth execution of the off-market transfer and approves the instructions from the DP. There is no stock exchange or clearing corporation involved in the off market trades.
What is NSDL Off Market Transfer
NSDL Off Market Transfer refers to the transfer of securities between two parties outside the regular stock market trading process. It allows you to transfer your securities holdings from one demat account to another directly through the National Securities Depository Limited (NSDL) platform.
The purpose of this method is to facilitate secure and streamlined transactions, bypassing the complexities associated with the exchange platform.
Parties involved in the NSDL Off Market Transfer
- Transferor – individual or entity who wishes to transfer the securities.
- Transferee – recipient of the securities, provide the necessary instructions and documentation to NSDL.
- Depository Participant (DP) – Acts as an intermediary between the transferor, transferee, and NSDL.
- NSDL acts as an intermediary and facilitates the smooth transfer of securities from one demat account to another.
You may like to read how to transfer the shares from ICICI direct to Zerodha.
NSDL Off Market Transfer Procedure
You need to give the instruction for NSDL off market transfers.
If you are a selling client you need to give the “Delivery instructions” and for the buying client give the “Receipt instruction” to transfer the NSDL off market shares.
Steps to follow for NSDL Off Market Transfers:
Step #1. Contact your Depository Participant (DP)
You can contact your DP (where you maintain your demat account) for obtaining the Delivery Instruction Slip (DIS) and off market transfer annexure form.
Or, you can download the instruction slip from here –
Step #2. Fill out the required details
You need to provide accurate details of the securities to be transferred, including ISIN (International Securities Identification Number), quantity, DP ID, DP name, client name, and any additional information required.
Step #3. Submit the instruction form to his DP
Sign the instruction slip and submit the filled-out form along with the necessary supporting documents, such as a copy of your demat account statement, PAN card, and identity proof, to your DP.
Ensure that the buying client must submit the filled Receipt Instruction Slip (RIS) to their DP to accept the transferred shares.
You need to open a Zerodha Demat account in case you don’t have the account yet.
Step #4. Verification and Processing
The DP verifies the documents and forwards the request to NSDL for processing.
NSDL matches the delivery and receipt instructions details. If there is any discrepancy, the transfer will not take place.
The transfer of securities occurs on the execution date mentioned in the instructions. This date specifies when the securities are moved from the selling client’s account to the buying client’s account.
Frequently Asked Questions
Yes, stamp duty is applicable on off-market shares transfer. The rate of stamp duty may vary depending on the state in which the transfer takes place.
It is important to comply with the applicable stamp duty regulations and pay the required stamp duty during the off-market transfer process.
Off Market Transfer refers to the transfer of securities between two parties without the involvement of a stock exchange or clearing corporation.
The time required to complete an off-market transfer can vary depending on several factors, including the efficiency of the DP and NSDL, and the completeness of the documentation.
Generally, it can take 1 to 10 business days to complete the transfer.
The charges for off market share transfer is levied by the Depository Participant (DP). The charges may vary depending on the Depository Participant (DP) and the value of the transferred securities.
It is advisable to check with the DP regarding the applicable charges before initiating the transfer.
Off market transfers are subject to certain restrictions and regulations imposed by the SEBI.
For example, off market transfers between promoters and public may require additional scrutiny, disclosures, and regulatory measures.
Yes, NSDL off market transfer allows you to transfer securities to family members or friends. However, certain eligibility criteria and restrictions may apply.
