How to Close an HDFC Demat Account – A Complete Guide

Rohan opened an HDFC Demat account in 2020 but stopped trading in 2022. His account holds no securities, but he’s still being charged ₹500 annually as maintenance fees. Over two years, he paid ₹1,000 for an inactive account. If he closes it now, he saves ₹500/year. If he keeps it open for another 5 years, he’ll waste ₹2,500. Closing the account eliminates unnecessary costs.

Also, unused demat accounts drain money through annual fees. Closing them saves long-term costs. If you have an HDFC Securities demat account and are considering closing it, this guide will walk you through the process step-by-step.

HDFC Demat Account Overview:

A Demat account is important for holding and trading securities in electronic format. However, there may come a time when you decide to close your demat account, whether due to inactivity, switching to another broker, or simply because you no longer need it.

Key features to consider before HDFC Demat Account Closure:

Demat account closing can be simple, yet to avoid undue inconvenience; there are some points that you need to recall. Bear in mind the following essential points before closing the HDFC Demat account:

• Check Existing Holdings: Before closing your Demat account, check your account and ensure that no existing shares or securities are there. All your holdings in the account must be sold or shifted to some active Demat account. Failure to do so may result in losing your investments when the account is closed.

• Clear Outstanding Transactions: Outstanding buy and sell orders or unsettled transactions must not be present. Active orders in your account must all be settled before requesting closure to avoid delay or rejection.

• Pay Annual Maintenance Charges (AMC): Check if any Annual Maintenance charges (AMC) or any other dues are pending against your account. Pay all pending charges in advance before applying for closure since the application will be submitted only after payment of all pending charges.

• Make sure your nominee information isup-to-date. Check your nominee information is accurate and up-to-date. This will not affect the closure itself but is required in case of current holdings or future dividend credits.

   

• Transfer Existing Securities: If you want to retain your current shares, you must shift them to another existing Demat account. You need to complete a transfer form and furnish the associated information, such as the ISIN (International Securities Identification Number) and the recipient's Demat account number.

• Download Account Statements: Before closing an account, download all your account statements and transaction history. This documentation may be useful for tax returns and in the future, particularly if you may have to provide evidence of investment in the past.

• Cancel Power of Attorney (POA), if any: You may have already granted Power of Attorney (POA) to your broker to trade on your behalf. Now, you will have to cancel it before closing your Demat account. It prevents its misuse or wrongful use in the future.

• Bank Account Linking Confirmation: Confirm that the bank account linked to your Demat account remains active and operational. This will be required in the event of receiving any outstanding payments, such as dividends, refunds, or the balance in your account.

• Know Closure Procedure: Familiarize yourself with the closure procedures available. HDFC offers both online and offline closure, depending on whether your account has any shares. Choose the mode most convenient to you.

• Keep Copies of the Closure Form: Keep a soft copy or a photocopy of the filled-up closure form and any other document filed. It will serve as evidence in case any follow-up or dispute has to be done after filing the closure application.

   

Considering the above points, close your HDFC Demat account hassle-free and without surprise issues and safeguard your investments.

Why Should You Close Your HDFC Demat Account?

Now, let's learn why you should close your HDFC Demat account before discussing how to do it:

Laziness: If you have never used your account or traded, it will be economically sensible to close it.

• Broker Change: If you find a better broker who meets your needs, move your stocks and close the HDFC account.
• Charges: HDFC Securities has the right to recover maintenance charges against your Demat account, and you can avoid them by closing the account.

• Consolidation: You can choose to group your investments into a single account to make them easy to manage.

   

How to Close HDFC Demat Account?

Your HDFC Securities Demat account could be closed online or offline. But the facility of closure is available online if you have zero-holding accounts. If you hold securities in your Demat account, you have to undertake the offline process of closure as under:

Online Closure Process (For Zero Holdings Only):

If your HDFC Demat account has no shares or securities left and you have cleared all pending charges, the online closure is the easiest and quickest option. It saves you from paperwork and branch visits.

Follow these simple steps to close your HDFC Demat account online:

1. Visit the HDFC website.

    

2. Navigate to Personal > Resources > Auction Notice > Forms Center > Form Center Demat >Demat Account Closure Form (NSDL & CDSL).

    

3. Fill in the Closure Request Form:
   • You will need to fill in details like your Demat account number, registered name, reason for closure, and any other necessary information.

   • Make sure all details are accurate to avoid any delays.

      

4. Submit the Request:

   • After filling out the form, click on 'Submit' to place the closure request.

      

5. Receive Confirmation:
   • Once your request is successfully submitted, you will receive an email and an SMS confirmation.
   • The closure process typically takes around 3 to 5 working days.

Example: Sneha had an HDFC Demat account with zero holdings and no dues. She logged in to her HDFC Securities account, followed the online closure steps, and submitted her request. Within four days, she received an email confirming the closure. By closing her unused account, she saved ₹500 annually in Annual Maintenance Charges (AMC).

Offline Closure Process: 

If you have securities in your HDFC Demat account or prefer a physical submission method, the offline process suits you. This method lets you close your account after transferring or selling your holdings.

Follow these steps for closing your HDFC Demat account offline:

1. Download the Closure Form:

   • Visit the HDFC Securities website and download the 'Demat Account Closure Form.'
   • Alternatively, you can visit your nearest HDFC Securities branch and collect the form.

    

2. Fill in the Closure Form:
   • Please carefully complete the form with all the required details, including your Client Name, demat account number, and Reason for Closure.

   • If you wish to transfer your securities to another Demat account, mention the target Demat account number and Depository Participant (DP) details.

      

3. Attach Necessary Documents:
   • Gather self-attested copies of your PAN card, Identity proof (Aadhaar, Passport, or Voter ID), and Address proof.

   • Ensure that all copies are clear and legible to prevent any rejection.

      

4. Submit the Form and Documents:
   • You can submit the completed closure form along with the required documents at your nearest HDFC Securities branch.
   • Alternatively, you can courier the form and documents to the HDFC Securities head office in Mumbai or email the scanned copies to customercare@hdfcsec.com.

Example: Rohan held an HDFC Demat account with 10 shares of Infosys. He downloaded the closure form and filled in his details, including his new Zerodha Demat account information. He attached copies of his PAN card and Aadhaar as ID proof. Finally, he submitted everything to the HDFC branch near his house. Within a week, he received confirmation that his account was successfully closed, and his shares were transferred to his new account.

Demat account closure in NSDL

If you have a demat account in NSDL (National Securities Depository Limited), you must email customercare@hdfcsec.com for assistance in the closure process.

Eligibility Criteria for HDFC Demat Account Closure:

You need to understand eligibility criteria for both procedures before choosing the online or offline closure process. Your eligibility will depend upon your holding position and outstanding payments.

Eligibility for Online Closure:

• You can close your HDFC Demat account online only if it is free of securities. That is, there should be no shares, bonds, mutual funds, or other investments left in the account.

   

• There should be no outstanding dues or unpaid fees, such as Annual Maintenance Charges (AMC) or other fees.

   

Eligibility for Offline Closure:

• If you hold stocks, mutual fund units, or bonds in your account, you cannot close it via the online facility. You must transfer such holdings into another Demat account or redeem them before beginning the process of closing them down.

   

• Even without holdings in your account, yet not desiring to make use of online submissions, you are allowed to make use of the offline facility to close the account

   

Why Close Your HDFC Demat Account?

Costs of Closing an HDFC Demat Account

Common Mistakes to Avoid When Closing an HDFC Demat Account

• Not Verifying Holdings Most account holders presume their Demat account is vacant. Subsequently, they find it has residual shares, dividends, or pending transactions. Omitting these can result in losing investments or transfer problems.

   

Solution: Always verify your holdings through the HDFC Securities Portfolio. Make sure all shares are sold or transferred before requesting closure.

Example: Rohan was about to close his account but discovered 10 TCS shares. He shifted them to his Zerodha account first before continuing.

• Omitting Annual Maintenance Charges (AMC) Dues Outstanding AMC charges may postpone or reject the closure application. Even dormant accounts incur these fees every year.

   

Solution: Check your statement for outstanding AMC dues. Settle all pending charges before filling out the closure form.

Example: Priya filled out her form but had ₹500 AMC dues. Her closure was put off until she paid up.

• Inadequate Documentation Missing or inaccurate documents are a reason for rejections. PAN cards, ID proofs, or unsigned forms are most common.

   

Solution: Complete the closure form correctly with your client ID and account number. Ensure self-attested copies of PAN, Aadhaar, and other documents. Check for your signature as well.

Example: Rahul forgot to attach his PAN card. His application was rejected, delaying the closure by two weeks.

Tip: Before submitting your closure request, verify holdings, clear AMC dues, and ensure all documents are attached. This will prevent delays and ensure a smooth account closure.

Time Required to Close an HDFC Demat Account

The duration to successfully close your HDFC Demat account depends on the method chosen.

Online Process: If you opt for the online closure process, your account is typically closed within 3 to 5 working days, provided that the details you submit are correct.

Offline Process: The process can take 7 to 15 working days for those choosing the offline method. This timeline may vary depending on the verification of your documents and the processing time at HDFC’s end.

2. Handling Shares Before Closing the Account

Before initiating the closure request, ensuring that your HDFC Demat account does not hold any shares is important. There are two ways to handle your existing securities:

• Transfer the Shares: You can transfer your shares to another active Demat account for a small fee, usually ₹25 per ISIN (International Securities Identification Number).

   

• Sell the Shares: If you prefer, you can sell your holdings in the stock market. Once the sale is complete and the funds are credited to your bank account, your Demat account will show a zero balance.

Example: Priya had 100 Infosys shares in her HDFC Demat account. She transferred them to her ICICI Demat account before starting the closure process.

Fees and Reopening Considerations

There is no penalty for closing your HDFC Demat account, but you must ensure that:

• Your trading account has a zero balance, meaning no funds or unsettled transactions.
• All pending AMC (Annual Maintenance Charges) are cleared before submitting the closure request.

Conclusion: 

Closing your HDFC Securities Demat account can be simple if you take the proper steps. Whether you close it online or offline, ensure you have completed all the required details, including transferring securities and paying any dues. Knowing the reasons for closure and the procedure involved, you can make a well-informed decision that suits your financial objectives.

Pro Tip: Keep the confirmation email and closure documents for future reference after closing the account.

FAQ:

1. What is the annual maintenance charge (AMC) for the HDFC Demat account?
   AMC typically ranges from ₹400 to ₹1,000 per year, depending on the account type.

    

2. Can I close my HDFC Demat account online?
   Yes, you can close it online, but only if there are zero holdings and no dues.

    

3. Is there any fee to close the HDFC Demat account?
   Account closure is usually free, but some brokers may charge a nominal fee.

    

4. What happens to my shares if I don’t close my inactive HDFC Demat account?
   Your shares stay safe, but AMC charges will keep accumulating.

    

5. Can I transfer my HDFC Demat account to another broker?
   No, but you can transfer your shares to another broker’s Demat account.

    

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