The number of Demat accounts in India is increasing day by day since the country achieved a record 192.4 million Demat accounts in FY25. However, while investing in the stock market and exploring different investment strategies, it sometimes becomes problematic for investors to remember the solution to every problem due to information overload.

This blog addresses the above pain point and explains crucial procedures like finding the Demat account number from PAN, converting physical shares into Demat, and other essential things.

How to Convert Physical Shares into Demat?

Although it has become mandatory to open a Demat account in India, some people still use physical shares. If you are one of them and want to modernise your investments, follow the steps below to convert physical shares into Demat:

• Step 1: Open a Demat account with a depository participant (DP) that is registered with the Securities and Exchange Board of India (SEBI) if you do not have one. You can open it with a bank, brokers, and relevant service providers.
• Step 2: Fill out the Demat request form (DRF) and submit it along with your physical share certificates. You need to mark ‘Surrendered for Dematerialisation’ in each share certificate.
• Step 3:  The DP will send an SMS or an email to the Registrar and Transfer (R&T) agents, who maintain your account. The R&T will verify your DRF form and authenticate your physical share certificates.
• Step 4: Once the R&T approves your DRF, the DP transfers the dematerialised shares into your Demat account.

Benefits of Converting Physical Shares into Demat

As of March 2025, the National Stock Exchange (NSE) holds a total of 4.92 crore Demat accounts in India. After understanding how to convert physical shares into Demat, here are its key benefits:

• Enhances Security

The dematerialisation of shares also enhances the security of your shares since they will be kept in an electronic format. It reduces the risk of theft and loss of shares.

• Effortless Transactions

By linking your Demat account with a bank account, you can easily transfer the funds, eliminating the need for cheque writing.

• Nomination Facility

Converting physical shares into Demat also provides the facility to add a nominee to operate the account in your absence. 

• Accessing Loan Facility

One of the best features of dematerialising your physical shares is that you can use them as collateral for loans for financial flexibility.

How to Find Your Demat Account Number Using Your PAN?

It often happens that you cannot remember your Demat account number when you need it the most. One of the common solutions to this problem is using your registered PAN. If you are wondering how to find the Demat account number from PAN, you can follow these simple steps:

• Step 1: Open the application or visit the website of your depository participant (DP).
• Step 2: Enter the accurate information and fill out the application form.
• Step 3: Complete the KYC procedure by submitting the documents related to your identity and residence.
• Step 4: Use the two-factor authentication to authenticate your provided information using your mobile number and email address.
• Step 5: Verify your bank and initiate the electronic clearing service (ECS) for a smooth transaction.
• Step 6: You will receive an email at your registered email address, which includes the information about the Demat account. Look for emails from CDSL and NSDL that contain the Demat account number.

How to Avoid Paying Unnecessary Charges in a Demat Account? 

One of the limitations of a Demat account is paying unnecessary fees even if you are not a frequent trader or do not hold high-value securities. The annual maintenance charges (AMC) usually range from INR 300 to INR 1000. However, there is a simple way to avoid paying such fees if you do not actively trade.

A Basic Service Demat Account or a BSDA account requires much lower fees compared to regular Demat accounts. If the value of your holdings is less than INR 4 lakh, you do not have to pay any AMC in BSDA. In addition, if it is between INR 4 lakh to INR 10 lakh, you are liable to pay only INR 100. This not only lowers your expenses but also helps newcomers to trade easily.

Final Words

Investors in India need to understand and manage their assets effectively. You can use your PAN to identify the Demat account number, transfer physical shares to digital form, and reduce unnecessary Demat account expenses. By following the above procedures, you can make your investment journey easier.