CDSL stands for Central Depository Services Limited. It is an Indian company that operates as a securities depository, providing depository services to facilitate the holding and transfer of securities in electronic form. This company was established in 1999 and is licensed by the Securities and Exchange Board of India (SEBI).
CDSL functions as a central depository for securities, making it possible for investors to hold and transact in securities in dematerialized or electronic form rather than in physical certificates. It provides a secure and efficient platform for the issuance, trading, and settlement of securities, thereby eliminating the need for physical movement and handling of securities.
The role of CDSL includes maintaining electronic records of securities, such as stocks, bonds, debentures, and mutual fund units, held by investors. It facilitates the transfer of securities through electronic means and ensures accuracy, transparency, and security in the transaction process. Additionally, CDSL offers other related services like pledge and hypothecation of securities, corporate actions like dividends and bonuses, and e-voting for shareholders.
CDSL is an essential component of the Indian capital market infrastructure, enabling market participants to seamlessly transact and settle trades in a cost-effective and timely manner. It has played a significant role in the digitization of securities and has contributed to the growth and development of the Indian financial markets.
