What should I do if I want to pledge electronic securities?
The procedure is as follows
Both you (pledgor) as well as the lender (pledgee) must have depository accounts;
You have to initiate the pledge by submitting to your pledgor DP the details of the securities to be pledged in a standard format;
The pledgee has to confirm the request through its DP. It is suggested that after creation of the pledge request, you may inform the pledgee and request him to confirm the request;
Once this is done, your securities are pledged. All financial transactions between the pledgor and the pledgee are handled as per usual practice outside the depository system.
How can I close the pledge after repayment of my loan?
After you have repaid your loan, you can request for a closure of pledge by instructing your DP in a prescribed format. The pledgee on receiving the repayment will instruct its DP accordingly for the closure of the pledge.
Whether pledgee account can be in a different DP?
Yes. The pledgee can have an account with a different depository participant of NSDL.
Can I change the securities offered in a pledge?
Yes; if the pledgee [lender] agrees, you may change the securities offered in a pledge.
Who will receive dividend on the pledged securities?
Pledgor will continue to receive dividend on the pledged securities. The pledgee will get the benefits only if pledge is invoked and on record date the shares are in the pledgee's demat account.
