Partner With Us NRI

Difference between dematerialisation and rematerialisation


You have recently opened a Demat account to purchase securities and monitor your trades. But you've also heard that you can now convert your electronic shares into their physical form through rematerialisation. How does that work, and what is the difference between dematerialisation and rematerialisation? We find out.

What is dematerialisation?

When you trade in securities through your Demat account, you receive shares or debenture certificates in an electronic form that are stores in the Demat account. This process is known as the dematerialisation. The SEBI mandates a Demat account for all investors and traders to conduct trades and invest in shares and other securities. Transacting through a Demat account prevents the risk of forgery and fraud.

What is rematerialisation?

If you wish to convert your shares into a physical form or certificates, you can do so through the rematerialisation process. To do so, you would need to submit the rematerialisation request to the Depositary Participant (DP) with whom you have an account. The DP enters the bid in its system and blocks your holdings to that extent automatically.

Is there a difference between a Demat account and dematerialisation?

A Demat account is compulsory when trading or transacting in securities.

However, dematerialisation is not mandatory. That means you can choose to convert your electronic shares into a physical form. But when it comes to selling them on the stock exchange, you will need to dematerialise them. Similarly, when purchasing shares, you receive them in an electronic form — dematerialised form.

The below table highlights the key differences between dematerialisation and rematerialisation.

Differential Factors




Physical shares are converted into the electronic format

Electronic shares are converted to the physical form

Cost of maintenance

Annual maintenance costs and other transaction fees are applicable as specified by the broker

Physical certificates do not require maintenance charges


No threats to shares held in the electronic form

High chance of theft, misplacement, fraud and forgery

Identification attributes

Shares held in the dematerialised form do not have a distinct number

Physical shares hold distinct numbers issued by the RTA

Transaction approach

All transactions take place electronically

Post rematerialisation, transactions take place physically

Maintained by

NSDL or CDSL — depository participants — maintain the account

The company maintains the account


Dematerialisation is a simple and easy process; mandatory when trading in shares.

Rematerialisation a complex procedure and takes an extended period of time. The process is typically a long drawn and requires expert assistance.

Application form used

Investor needs to fill out the Dematerialisation Request Form [DRF]

Investor needs to fill out the Rematerialisation Request Form [RRF]


It is the principal and primary function of the depository, and is an initial process.

It is a secondary and supporting function of the depository and a reversal procedure.


Having a Demat account can facilitate the buying and selling of securities in addition to several benefits. But to become a successful investor or trader, you need to find the right full-service, well-established broker. Their analysis, research and recommendations can go a long way in helping you navigate the stock market smoothly.

Disclaimer : ICICI Securities Ltd.( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Centre, H. T. Parekh Marg, Churchgate, Mumbai - 400020, India, Tel No : 022 - 2288 2460, 022 - 2288 2470.  The contents herein above shall not be considered as an invitation or persuasion to trade or invest.  Investments in securities market are subject to market risks, read all the related documents carefully before investing. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. The contents are solely for informational and educational purpose.

Most Popular

  • 18 Jan 2022
  • ICICI Securities

Upcoming Union Budget 2022: F&O Trading and Risk Management Strategies you Should Note to Manage Risks Better

The Union Budget of India, also referred to as the Annual Financial Statement in Article 112 of the Constitution of India, is the annual budget of the Republic of India. The Government presents it on the first day of February so that it could be materialized before the beginning of new financial year in April.

  • 17 Jan 2022
  • ICICI Securities

TCS announces Rs 18,000 crore share buyback: How can Investors benefit from the opportunity?

Tata Consultancy Services Limited board on 12th Jan, 2022 approved a proposal to buy back upto 4,00,00,000 Stocks for an amount not exceeding Rs 18,000 crore at Rs. 4,500 per share. 

  • 12 Jan 2022
  • ICICI Securities

What is a Bond Ladder? & How to Use it to gain from Debt Funds?

Investing in bonds that mature on different dates makes a bond ladder. Read on to know how to make gains from debt funds using a bond ladder.

  • 12 Jan 2022
  • ICICI Securities

The shoe must go on! An overview of the Indian footwear industry

The Indian footwear market has seen many changes in customer behaviour towards footwear.

  • 12 Jan 2022
  • ICICI Securities

Is a 50:50 investment in Large-Cap & Mid-Cap Funds a good idea?

Large-Cap vs Mid-Cap asset allocation can be tricky, especially when the market is experiencing some headwinds. Developments and economic cues can either push the market indices higher or push them off a cliff.

  • 11 Jan 2022
  • ICICI Securities

Demerger in Motherson Sumi Systems Limited: Implications on your F&O positions

Motherson Sumi Systems Limited has fixed a Record Date of January 17, 2022 for the purpose of issuance and allotment of 1 equity share of Motherson Sumi Wiring India Limited for every 1 equity shares to shareholders of Motherson Sumi Systems Limited.

  • 11 Jan 2022
  • ICICI Securities

NSE to launch Futures and Options for Nifty Midcap Select Index from 24th January

F&O Trading has evolved in India with F&O volumes now contributing to more than 95% of overall NSE volumes. F&O volumes in NSE have nearly doubled in FY 22 compared to FY 21 same time.

  • 09 Jan 2022
  • ICICI Securities

Demerger in GMR Infrastructure : Implications on your F&O positions

GMR Infrastructure Limited has fixed a Record Date of January 12, 2022 for the purpose of issuance and allotment of 1 equity share of GMR Power and Urban Infra Limited for every 10 equity shares to shareholders of GMR Infrastructure Limited.

  • 06 Jan 2022
  • ICICI Securities

Best Stocks to Buy in 2022

The new year is here, which means it's time for new investments! If you're wondering which are the best stocks to buy in 2022 that will give you returns in the range of 20%-80%, we've got a list of 10 top stocks in different sectors that you should definitely consider for your portfolio.

  • 04 Jan 2022
  • ICICI Securities

What is smallcase? Know Investing Ideas via smallcases

In our efforts to offer you the most seamless investing experience, we’ve partnered with smallcase. What exactly are smallcases? They are baskets of stocks or ETFs based on relatable ideas. They are professionally managed by registered entities or individuals.