The Hindu Business Line : CDSL to levy flat fee for DP deals

THE Bombay Stock Exchange-promoted Central Depository Services (India) Ltd has decided to reduce the transaction charge it collects from Depository Participants (DPs) to a flat fee of Rs 5 for debits effective from January 1, 2006.

"The decision is in keeping with its stated stance of providing convenient and secure depository services to all classes of investors at a reasonable cost," a press release from CDSL said on Wednesday.

Mr Cyrus Khambata, Vice-President (Business Development and Operations), CDSL said: "From January 1, 2006, our DPs will receive lower bills. The ability of DPs to price their services attractively is in large measure, dictated by set-up costs, operating costs and the transaction charges they have to pay the depository. CDSL has always been competitive in this respect and with the present reduction, our DPs will be in a better position to give investors an affordable deal."

Since May 1, 2002, CDSL has levied a "ranged" fee of 0.01 per cent of the value of debit transactions (minimum Rs 5 and maximum Rs 12).

"The present tariff reduction also addresses the aspiration of DPs who were in favour of a flat charge, which, they submit, makes computation of individual client bills easier," the release said.

Meanwhile, during the first eight months of current fiscal, CDSL has opened over 4.23 lakh new demat accounts. In the same period, 24 entities have received registration as CDSL DPs.

Further, four others have received in-principle approvals and 37 DP applications are under process.

The release said CDSL was expected to cross the 300-mark for registered DPs.