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You can Pledge or hypothecate your dematerialized shares against loan or credit facilities extended by a Pledgee who also has an account with a DP


PROCEDURE


Pledgor fills in the instruction (Annexure- W) requesting the DP to Pledge shares and hands it over to the DP.


If the instruction complete in all respects, the DP processes the same and generates a Pledge order number for the request tenderd by the Pledgor


Securities to the extent of the instruction are debited from the free or locked-in balances and credited as Pledged balances of the Pledgor so that they cannot be used for any transactions.


If the Pledgee accepts the request by the Pledgor, the acceptance is communicated electronically to the Pledgor's DP. Once the Pledgee's DP confirms the acceptance of the Pledge, the Pledgor cannot cancel the Pledge / hypothecation order. The Pledgee's DP executes the Pledge / hypothecation request as per the instructions given.


In case the Pledgee rejects the Pledge request, the Pledgor's DP is intimated electronically. Now the securities which were earlier credited as Pledged balances will be credited to free / locked-in balances.


Once the loan is repaid by the Pledgor, the Pledgor initiates the closure of the plegde. The request for closure is transmitted electronically to the Pledgee's DP. The Pledgee's acceptance of closure request by executing conformation of closure request transmitted electronically to the Pledgor's DP. In case of non-acceptance of the closure request, the Pledgee will reject the same.


If the Pledge is closed, the securities will be reflected as free / locked-in balances.


In case the Pledgor defaults in repaying the loan to the Pledgee, the Pledgee instructs his DP to invoke the Pledge / hypothecation.


If you are a Pledgor If you are a Pledgee

The Pledge/ hypothecation request form must be complete in terms of agreement number, closure date, Pledgee details and details of securities

The form for accepting the Pledge / hypothecation request must be complete in all respects

The form submitted for closure of Pledge / hypothecation is complete in all respects

The form for closure conformation and invoking the Pledge / hypothecation request is complete in all respects