Demat account: A beginner’s guide to all you need to know

Over the last few decades, the stock market segment has progressed to great heights, allowing investors the opportunity to invest small amounts and get good returns. In keeping with this progress, the stock market segment is now progressing to a digital platform, allowing potential investors to easily access their shares and equity, with a quick turnaround, and even updated news regarding the market deals.

As a first step into stock market trading and transactions, there will be a requirement to first open a demat account. It functions similarly to a bank passbook. Using this account, you can easily purchase or sell shares of different stocks, which can only be done through the account. When you make a purchase or sell, the stock is converted from a paper form into an electronic form, known as dematerialization. The reversion of the process is known as rematerialization.

How to open a demat account

In order to open a demat account you must follow these steps:

• You must first approach a depository participant ( DP ). The function of the DP is to act as the intermediary between the investor and the depository.Ensure it is registered with the National Securities Depository Ltd. (NSDL) andthe Central Depository Services Ltd. (CSDL).
• The manager from the DP will provide you with an application form that will need to be filled and deposited back to them. You will need to provide certain mandatory documents, such as identity and address proof. You will also need to provide an original PAN card during the process of account opening.
• Once the documentation is processed, your DP will provide you with a unique account number, also known as the demat account number. You will also be provided with a unique log in ID as well as password. This allows you to access the account anytime you need to make a transaction.
Once this process is done, the DP who also functions as a stock broking firm, bank or even a sub – broker will demand a minimum cheque in your name. This is a normal protocol which allows you to begin purchasing shares.  In this case, the DP will purchase dematerialized shares in your name and save them into your account. You will also be charged a minimum broking charge for this transaction.

What are the advantages of trading through a Demat account?

Through the demat account, you will have access to:

• High security in transactions
• Timely delivery of shares
• Reduction in the probability of fraudulent transactions
• Trading in huge volumes
• The cost per transaction is comparatively lower to physical trading, due to the reduction of the costs associated with paper usage or stamp duty.
• Mobility and ease of working from any location
• Investing in IPO’s, ETF’s of gold

Why should you ditch your car for two wheeler today?

Traveling all over the place will offer you plenty of benefits. No doubt, you will have the luxury and comfort to travel from one destination to another in comfort. That is until you get stuck in traffic. Not to mention the large bill you will need to pay a month on month for fuel, maintenance, and insurance.  Very soon, a two-wheeler will look more of a favorable option as compared to a four wheeler. So why should you ditch your car today? Here are reasons why:

Easy to divert through traffic

One of the main benefits of a two wheeler is the ability to maneuver through traffic. Major cities that possess a high level of professional industries will have regular traffic congestions, especially during certain hours of the day. Highways, flyovers and even expressways are normally filled with traffic, especially during peak hours. While you may not be able to avoid it all the time, the best way to go through it and still be punctual is by opting for a two wheeler. Two wheelers are designed in such a manner where it is easier to maneuver through traffic with ease. Additionally, it is equipped with quick speed, so traveling will not take much time.

Affordable

A two wheeler is not only about traveling through traffic, but it also offers a good affordability. In other words, even a common man can afford a two-wheeler, if he has a steady income and a steady for at least the next few years if not months. Most two-wheelers come in a range of 1 lakh to 5 lakhs depending on the company and model you are buying. Additionally, you can purchase your two-wheeler with the help of a two wheeler loan. In most cases, the loan lender will have tie-ups with certain outlets, wherein which, a purchase from this outlet, will provide you with plenty of other benefits such as discounted insurance, free 1-year service and even deals on add – on.

Economically viable in the long run

While purchasing this vehicle with a two wheeler loan and using it may seem easy, there is also the responsibility to maintain the bike on a long term basis. This means, you will need to ensure that it is regularly serviced, insurance must be renewed in time, pay for replacements parts when needed, while also keeping in mind the regular expenditures such as fuel. While the same factors apply to a four wheeler, it is often more expensive as compared to two wheeler. Additionally, if you are using a two wheeler for a single individual, it is easier for a single earner to maintain it.

Apart from these reasons, there are plenty more. However,in the end, it depends on your decision to purchase the bike and maintain it.

Strategies to pay off your education loan

Getting a higher education is one way to ensure that you get better prospects in your professional life. However, higher education degrees come at a high price, which may be within your means, but at the same time, not in your current capacity. In other words, you may need to an education loan to sponsor your education, which you can repay back later.
However, this loan may be a means of borrowed funds, but it is also a debt that you will need to repay at some point in life. Any delay in this repayment will affect your other loan applications and your current credit score. The best way to ensure that your future financial profile is not affected, there are certain strategies you can incorporate that will help pay off your borrowed student loan with ease. They include the given:

Pay off your current debts

Paying off your current debts will help you focus on your primary debt, which is the education loan and the added interest rate. There are two methods through which it can be done. One method is the snowball method. Through this method, borrowers can pay off any previous debts will small balances first. At the same time, you can pay a minimum requirement on the rest of the other debts. The other method is the debt – avalanche method, which includes the means to pay off accounts with high-interest debts while paying off the minimum on the rest of the debts. Depending on your requirements, you can opt for the ideal strategy that will suit your needs.

Calculate the daily interest to stay aware

Being aware goes a long way to understanding the progress of your education loan repayment and what changes would be required in the process. No doubt, seeing a debt that will take ten years to repay with an additional interest to pay will seem discouraging in the long run. But as times goes by, the progress and reduction in your debt will help keep you motivated until the end, to get out of your debt. This will also help you stay focus on your goal to get rid of your debt as quickly as possible.

Get a side income

Earning one income will seem troublesome. But earning additional income will seem like an added burden. But if it goes a long way to repaying your education loan faster, it will work for your benefit. At the same time, you can live on a budget which is as minimum as possible for you so that any excess expenditure will be eradicated allowing you to have sufficient funds for repayment.

Make multiple payments throughout the month

Another effective way to pay off a loan is to opt for multiple payments over a single payment, within the month. For example, instead of paying one single payment in the month, you can opt for biweekly payments. This allows you to divert any spare funds to debt payment, without risking it being used for other expenditures.

Questions you need to answer before applying for a persona loan

When there is a financial requirement, and you are not in a position to borrow funds from your peers or family, you can always opt for a loan. The personal loan has always been an ideal choice for individuals who are seeking financial aid in the form of the loan. Not only does it require no security to be provided, but it also requires minimum documents to be provided.

However, as easy it can be to acquire this loan, there are certain questions you must first answer yourself before beginning the application process. These questions ensure that you have a clear understanding of your requirements as well as to be aware of how much funds you are eligible for. These questions include the following:

Q1. Is it necessary to spend or purchase now?

You find that the LCD TV you’ve always wanted is suddenly on sale or even the vacation trip you’ve been eyeing for a long time is suddenly available to you at a discounted price. This perfect opportunity is only available now, and only needs an amount which you can afford through a personal loan. At this stage, you may be compelled to purchase a product or a service, but it may not be necessary. Such requirements may be under the category of luxurious spending. However, if you do require urgent funds for situations such as medical emergencies, then it is best to opt for this loan. Therefore, before you opt for this loan, consider your requirement and its level of urgency and priority before opting for it.

Q2. Can I afford the loan EMI?

This is one of the crucial questions that demands an honest answer. For if you are unsure of the response, you must wait till you are truly confident of it. Personal loans may be easily accessible. However, they demand a stringent repayment schedule. Additionally, you will also need to pay off high-interest rates with this loan. If you have the means and the income to repay the borrowed funds during the tenure, then you can proceed with this loan.

Q3. When is the ideal time to take on a personal loan?

When taking the responsibility of a loan, you need to consider different factors. Do you have a steady income? Do you have a steady job? What is your debt income ratio? How many individuals in your home are dependent on you? Is the loan that I need a small one or a large one? When you answer these questions, you will get an idea of whether you can afford your personal at any time.

Q4. What do I need to do if I can’t pay back the loan?

As a precaution, you would need to consider your future requirements before applying for any loan. But at times, you may not be prepared for all eventualities. If such an event affects your ability to pay EMI’s, you will need to require a backup plan. For one, you will need to access a source of funds that will help repay back the funds. Alternatively, you can approach your lender to review the terms of the loan in order to provide an alternative way to repay the borrowed funds.

PayZapp: What are the benefits of this app?

With the digital world slowly becoming integrated into our daily lives, it comes as no surprise that plenty of apps have been designed to provide a means and convenience to manage daily activities. Amongst the various launched and established apps, comes the PayZapp app.

The PayZapp app, launched by one of the largest financial card issues in the country, has gone one step ahead, by creating a virtual relationship manager through this mobile application. This app is designed to store all your banking card details in a dematerialized form, thereby allowing the account holder to use them for electronic payments. Under this app, the account holder can use a scan and pay option or even the mobile phone’s capability to tap and pay for purchase at the point of sale terminal. The account holder can also send funds to any peers through the app by using the IMPS platform.

Apart from these benefits, there are plenty that is offered by this app. They include the following:

Incentive programs: Plenty of apps have integrated loyalty-based incentive programs that motivate mobiles users to either refer the app to others or increase the utility of the app. Instead of having users inputting their card details every time they need to make a purchase or refer to someone, the information is already stored on the application. At the same time, businesses or merchant outlets that use technology to link several payments to points or other loyalty programs, while adding value to the customers. This encourages the customer to return, which increases the revenue. 

Ability to offer banking card payments: Plenty of individuals are opting for card payments over physical cash payments. However, not many business and merchant outlets are equipped to accept banking card payments. Not only would this affect the business, but customers would also be at a disadvantage. However, businesses are becoming more technologically economic and integrating mobile payment programs, in their system. Therefore, it allows business to charge customers through this app, which will benefit both the customer as well as the business.

Multiple banks can be used through this app: One of the main benefits of this account is that it can be used for other bank details too. Although primarily it was designed only for one bank, it can now be accessed by applicants who use other banks. This makes it easier for applicants to use multiple facilities and features which may or may not be provided by their bank. Take, for example; the bank may not offer cashback facilities through the card alone. But through the PayZapp app, you can get a small amount of funds as cashback.

How to plan your child’s financial future with a recurring deposit

Today, every individual is slowly becoming financially aware. Plenty of these individuals, especially parents are prioritizing financial planning for their whole family, especially when it comes to their children. But with so many financial options to consider, what are the best options that will not only provide the parents with the convenience to manage the funds but also the flexibility for their children to access the funds at the right time?

This is when the recurring deposit will make the ideal option. This termed deposit functions in such a manner where it allows the account holder to deposit a fixed amount of funds on a monthly basis until the tenure is met. Once the tenure is completed, the interest will be deposited along the recurring amount that has been invested. The invested amount can be anywhere as a much as Rs. 100 to Rs. 10,000 depending on the institute you are applying to. Additionally, you can even use the RD calculator to get the required amount that you would need to invest, and even the outcome that will come out of it. So how can you use this account to benefit you and your child?

• Fix a goal

As you grow older, you will notice that your financial requirements will increase over time. For one, you will need to set aside funds to run the house. Or you may also need additional funds to plan for a family event such as a birthday or a wedding. What better way to spend for such events, than by saving for it right from the begging? For such a requirement, you can open a recurring deposit for this purpose alone. Additionally, you can open several recurring accounts with different rates and tenures to match different financial goals. You can even use the RD calculator to calculate the ideal amount and interest you would want for this purpose alone.

• Fix a tenure

Like the financial goal, you can fix the tenure of the recurring deposit. The tenure of the recurring deposit can be a minimum of 6 months to a maximum period of 10 years. Once this tenure is met, you can either reinvest the amount in another account or renew the tenure for the same or different tenure. Fixing the tenure allows you to also fix the interest rate of your investment. Longer the tenure of the period, higher will be the interest rate. Since the interest will also be deposited at the time of maturity, you can use the extra funds in the same account.

• Fix a nominee
As a part of one of the functions of this account, the account holder is allowed to select a nominee. You can open an account under your name, along with your child’s under the minor category. Once the child reaches the required major age, the account holder can transfer the account to the child’s name, or make it the primary holder of the account. This allows the child to use funds as per one’s requirement, while also allowing them to maintain the account for a long term purpose.

All about NRI Banking

What Exactly Is NRI Account?

As the name suggests, Non-Resident Indian, an NRI account is basically a person that has an account in an Indian bank but is not an Indian resident. An NRI banking account is offered by a number of banks. It is a great option for all your banking needs. In fact, it is a handy tool.

Banks offers various NRI banking options. Various products and services are provided that help in your NRI banking. There are a number of benefits associated with NRI banking. Some of them includes:

• Convenient banking solution – One of the significant advantage related to NRI banking is that it offers access to the banking system completely depending on the foreign and local needs. Furthermore, you can rely on it for quick financial transfer and even currency exchange.

• Time-saving – Another benefit offered by NRI banking is that it offers quick and easy access to the funds. This further ensures that you do not have to ring your Indian friend for any financial needs.

• Interest rate – You should also know that NRI banking accounts also offer an ability to compare the interest rates. It also provides an excellent earning potential between both abroad and home. 

Types of NRI Accounts

There are two major types of NRI banking accounts such as:

• Non-Resident External Account (NRE) – This type of account is defined when you deposit foreign currency while opening your account in an NRE account.

• Non-Resident Ordinary Rupee (NRO) – This type of account is called when an Indian who is going abroad with the intention of becoming an NRI.
What to Consider When Opening an NRI Account?

Following are the steps one need to consider when opening an NRI banking account:

• Choosing a bank – This is one of the major and the first step towards opening your NRI account. With so many banks offering this option it is wise to make a right choice. Choose the bank that meets your banking needs and requirements. One major aspect you need to keep in mind is to know whether the bank is authorized by the Reserve Bank of India (RBI).

• Account type – Now that you know there are two major NRI account types, choose the one wisely. Keep all your aspects in mind when making a choice.

• Online and offline banking experience – You will find banks offer both online as well as offline NRI banking solution. Ensure you apply for online banking too as it is convenient and hassle-free.

You will have a lot of people calling to open an NRI making. Stay away from these people as they might be fraudsters too. One of the best ways to open your account by visiting the bank. No matter which foreign place you reside in, the NRI banking solutions ensure you have economic links forever.