If my broker goes bankrupt, are my shares in demat account safe? And what about the cash balance in the trading account?
Yes. Your demat account is held by a third party, not the broker. For Zerodha it is CDSL.
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Shares are held by depository (CDSL,nsdl), not by broker. So we can be assured that they are safe from broker’s bankruptcy.
Funds might be at risk, not sure though.
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Nothing will happen to your share because it will be held by CDSL.
Your funds will be with the broker. But SEBI has imposed strict rules on all brokers and brokers have some government insurance in case something goes wrong. If your broker goes bankrupt then some other company will buy it at a discounted price.
There is a very less chance that you’ll loose your money.
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Exactly ,
My friend had a Demat account with Karvy and had a balance of 5k with them.
Later all his shares holdings were transfered to IIFL, and he lost only 5k in his trading account which was with Karvy.
He can get back his 5k too , provided he has time and resources to follow up with Karvy.
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https://www.edelweiss.in/insight/today-s-perspective-1/what-happens-if-stockbroker-goes-bust-in-india-9d3f96#:~:text=If%20your%20stock%20market%20broker,not%20your%20shares%20and%20stocks. **HOPE THIS HELPS U **
@thangamani88
1.) Shares in Demat are 100% safe as long as you have not given signed Power of Attorney to the broker.
2.) 100% chances of you losing money in the trading account in case the broker gets bankrupt.
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Daily we are getting cdsl credit , debit emails when ever trade occurs ( though with t+2 days) , monthly cdsl reports , now weekly statements from zerodha for credit debits , also daily we are watching in trading terminal abt quantities, over than this any possible issues would be there ?
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Share are safe with CDSL/NSDL.
In that case all transactions are governed by rules laid down in POA. If POA says broker can debit your shares for its own benefit then they can.
If a broker goes bankrupt, you can write to respective depository and they will transfer all your shares. For funds you can file complain within 3 years. In case broker sold your shares and transactions are not within POA rules, you can file complain and most probably transactions will be reversed. This is my understanding.
So it’s important to check credit/debit statement atleast bi-annually.
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See I asked a similar question from Nithin Sir, and here is his reply.
- So better you revoke your POA.
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Thanks @China_virus , @Stonecold , say if im revoking poa , i read in this forum , for selling have to place daily authorisation , before placing sell ( amo ) orders ? any drawbacks non poa ?
Not daily, only on the day when you want to sell your delivery shares.
Also we can place AMO after market closes and this order will be placed in next trading session. In that case TPIN authorized earlier becomes invalid. Make sure to authorize before sell order is placed on same trading day.
Cannot do panic sell 
(maybe this is a advantage).
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Actually im doing in many number of scrips in small quantity delivery cnc mode , sometime will exit intraday if target hit , sometimes 1 or 2 days , sometimes will take 1 week 1 month ,even some stocks 1 year also with averaging and exit in profits but not in loss like that . as number of scrips are more so placing amo order for all scrips evening for next day , say if im changing to non poa , i need to clarify these things ,
- no need to authorise and input cdsl pin ,otp for buy and sell same day in cnc as it is considered as intraday trade
- also btst trades also no need to authorise as the stock wont come to demat ?
- if im placing amo sell orders evening for next day , im able to authorise after market close for next day or authorise should be in next day morning or after any time specific ?
- stocks crediting in demat is happening at random time in t+2 day or sometimes t +3 days , so till that time no need for authorise just placing amo sell order is enough?
sorry too many questions . Thanks
Right.
You’ll have to authorize if you’re doing BTST. Here’s how BTST settlement works.
For non-POA users, you can place AMO and authorize after 5 PM. Explained here.
Whenever you’re placing a sell order for stocks in your holdings, CDSL authorization is needed.
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Shashik says:
Yes, it dosn’t work for only a day. Next day we have to authorize again. It is also asking for OTP which we have to fill in just three minutes, but you get OTP only after 5 to 7 minutes. And the OTP fails and max failed attempts are 3 and finally you are lost.
Does anybody using cdsl pin / otp , method ? are you getting delyed otp and got stuck after maximum 3 times / day , ?