Dematerialisation & Rematerialisation: Meaning and Process
5paisa Research Team
Last Updated: 13 Jan, 2025 07:20 PM IST

Content
- What is Dematerialisation?
- The Process of Dematerialisation
- Steps of Dematerialisation
- Steps of Rematerialization
- Difference Between Dematerialization and Rematerialization
- Things to Note Before Dematerialisation and Rematerialisation
- Conclusion
What is Dematerialisation?
The Indian stock market has come a long way since its beginnings in 1875 with the "Native Share and Stock Broker's Association," now the Bombay Stock Exchange (BSE). Over the years, technological advancements have transformed how shares are traded.
Earlier, investors had to keep physical share certificates safe from damage or loss, as losing them could lead to financial setbacks. This changed with the Depositories Act, 1996, which required all public companies to issue dematerialized shares.
In this article, we’ll explore dematerialization and rematerialization, their processes, and the differences that every investor should know.
Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing. For detailed disclaimer please Click here.
Frequently Asked Questions
Dematerialisation is the process of converting physical share certificates into electronic form, making trading and storage easier and more secure.
An investor may opt for rematerialisation to receive physical share certificates, often to avoid Demat account maintenance charges or for personal preferences.
No, during rematerialisation, your account is temporarily blocked, so you cannot trade shares until the process is complete.
Rematerialised shares are more vulnerable to risks such as theft or damage compared to dematerialised shares, which are stored electronically for enhanced security.