Minor Demat Account
Whatever your investing style, we have a solution for you
For First Year
Opening Charges
Customers
Benefits of Opening a Minor Demat Account with Us
Research-Backed Recommendations
To elevate the journey, minors can invest via Anand Rathi's in-depth market research and expert insights.
Pan-India Presence
Open minor demat account online easily through our extended support across India, along with strong digital platforms
Safe & Transparent
From start to finish, we ensure complete guardian control over the investment process. It assures your child's investments are safe.
Seamless Digital Process
The entire process is simple, paperless, and with minimal paperwork. No need to spend multiple hours on the account opening.
Financial Discipline at a Young Age
Introduces the concept of saving and early investing with our minor demat account facility, helping minors develop financial awareness.
Steps To Open A Minor Demat Account
With a few steps, minors can open minor Demat account online with Anand Rathi.
1
Fill Application Form
Find a guardian and, with their help, complete the Demat account opening form (if you are a minor).
2
Submit Documents
Provide KYC documents of the guardian and minor, along with bank details.
3
Verification
Spare some time. Let our team verify the details and documents.
4
Account Activation
Once approved, the Minor Demat Account is opened.
5
Start Investing
Guardian can manage and invest in securities on behalf of the minor.
Documents Required To Open A Minor Demat Account
Minor
Guardian
PAN card (mandatory)
Birth certificate/proof of age (Aadhar card)
Photograph
Bank account proof (cancelled cheque/passbook in the name of the minor)
Eligibility Criteria For Opening A Minor Demat Account
The most important criterion to open a minor dmat account online is being a minor first. Later, it includes:
The applicant must be a minor (below 18 years of age).
The account must be opened and operated by a guardian (parent or court-appointed).
A valid PAN card of the minor is mandatory.
Guardian should have all necessary KYC documents and the authority to act on behalf of the minor.
Only one guardian can be appointed per account.
FAQs
What is a Minor Demat Account?
A Minor Demat account is a type of account specifically opened for individuals under 18 years of age. It allows them to manage their investments in electronic form. With this demat account they can hold stocks, bonds , and invest in mutual funds.
Opening a minor demat account online ensures that minors have the opportunity to participate in the market while developing a sense of financial responsibility.
What are the charges for maintaining a minor demat account?
For maintaining a minor demat account online, a fee is applicable from the broker's side — typically called Account Maintenance Charges (AMC).
Can a minor invest in mutual funds?
Yes, a minor can invest in mutual funds using their minor demat account. However, the guardian must make, manage, and operate the investments on behalf of the minor.
What are the tax implications for a minor demat account?
There are only two sources through which a minor can earn income - Capital Gains and Dividend income. In both cases, the income will be clubbed with the parent who earns the highest income. It will be subject to the applicable tax liability.
What investments are allowed in a minor demat account?
As a minor, you cannot place any buy orders. Instead, the guardian will operate the account. The following types of investments are allowed:
- Equity Delivery (Cash Market):
- Buying/selling shares in delivery.
- Guardian places all orders.
- Mutual Funds (MFs):
- Investments allowed in the minor's name.
- Guardian performs purchase/redemption.
- IPO / Rights / Bonus / Split / Transmission / Gift:
- Minor can receive shares or allotments.
- Guardian applies on behalf of the minor.
- Bonds & Debentures (Debt Instruments):
- Both government securities (G-Secs) and corporate bonds/NCDs can be held.
- Orders placed by guardian.
- Sovereign Gold Bonds (SGBs):
- Can be held in a minor's name.
- Application made by guardian.
- Fixed Income Products via Demat:
- Includes Tax-free bonds, PSU bonds, and RBI Bonds (if issued in demat form).
- Application done by guardian.
What investments or activities are restricted in a minor demat account?
The following trading activities are not allowed in a minor demat account:
- Intraday trading (any segment)
- Futures & Options (F&O)
- Currency Derivatives
- Commodity Derivatives
- Margin Trading, Pledging, or Loan against Shares
What happens when a minor turns 18 years old?
Once the minor turns 18, the Minor Demat Account becomes inactive and must be converted into a regular account. The individual must submit a new application with updated KYC documents, complete re-verification, and sign new forms. Once converted, the guardian's details are removed and all existing shares are transferred to the new account.
Advantages of Minor Demat Account
By opening a minor demat account, parents can:
- Build financial awareness about stock markets and investing at an early age.
- Help their kids start early in wealth creation.
- Use it for long-term financial goals, such as education or marriage.
- Ensure all investments remain under the child's name.
Limitations of a Minor Demat Account
With the pros listed, there are a few limitations to opening a demat account online.
- Minors (also guardians) cannot trade in derivatives (F&O) or do intraday trading.
- Tax benefits are limited since income is clubbed with the guardian's income.
- The guardian has complete control — a minor cannot make decision on their own.
- Account conversion is mandatory once the child turns 18.