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What are the DP charges in Zerodha?

Jaleel M

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We all know that Zerodha comes with a no charges platform. But what is the meaning of “No Charges”? Will you have to pay something to your broker or not? So let us see what is the DP charges in Zerodha. In this article, we will explore the DP charges in Zerodha and how one can avoid paying these charges.

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What are DP charges in Zerodha?

These are the charges a trader has to pay when you sell shares from your DMAT account. These charges are imposed by CDSL(depository), which is identical to how trades charge a transaction fee or brokers charge brokerage. 

To give you a better understanding of these charges, I also presented an example to provide clarity on this subject. 

For example:

If you sell 50 shares of Y in the morning and 70 in the afternoon, the total appropriate DP charges for that stock for the day will be Rs. 13.5 + 18% GST.

Depository (CDSL) and the Depository Participant (Zerodha Broking Ltd) set the DP charges at Rs. 13.5 (+ 18% GST) per day per stock for the stocks sold from your pocket. Stock will be traded from your DEMAT account the same day you place your sell order.

Ways to avoid DP Charges at Zerodha

There is no direct way to save DP charges, but some steps are mentioned below by which you can add a little to your pocket. 

  1. Try to sell  BTST trades and intraday; these are the two ways by which one can save money. 
  2.  Trade in the derivatives (F&O) feature. Same as intra-day, there is no Demat trade in the case of F&O trading. 

Zerodha even demands a Demat annual maintenance charge (AMC) of Rs 300 per year. All Zerodha clients have to pay Demat AMC. If you have a Demat account that you are not utilizing currently or don’t have an objective to use, I should suggest you close it to avoid AMC. However, you can try to open an account with brokers that offer zero AMC Demat accounts.

Why are DP charges high; are there any other options available?

Stockbrokers usually charge zero Demat accounts as opening fees and annual expenses. Hence, these DP charges extend to the traders as an added fee. It is also the only source of earnings for depository participants who otherwise demand little outlay from their traders.

If you are looking for other option which doesn’t charge this much for Depository Participants, Then you should try to work with 5paisa.com. As they say, they have reduced DP transaction charges to Rs 12.5, and according to them, it is the lowest in the country.

Are DP charges compulsory to pay, and is there any chance of a refund?

Yes, DP charges are compulsory to pay for every user if you sell your holdings via your Demat account. CDLS charges Rs. 5.50 per firm – on a per-day basis. 

Traders charge a nominal fee for opening a Demat account with them, a non-refundable fee charged in advance while opening an account. 

Conclusion 

These are the charges a trader has to pay when you sell shares from your DMAT account. If you want to save money on this, you can read the ways to avoid DP Charges at Zerodha mentioned above. 

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