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MCA’s big reform mandates dematerialisation for private companies
India is taking a significant step towards enhancing the integrity of its financial markets with a new mandate from the Corporate Affairs Ministry (MCA). The MCA has made it mandatory for private companies to dematerialise their securities, marking a pivotal development in the evolution of India’s capital markets.Understanding the Mandate
Dematerialisation, often referred to as “Demat,” involves the conversion of physical securities, such as share certificates, into electronic or digital form. This transition from tangible paper to a digital format streamlines the management and trading of securities, offering several key advantages:
- Reduced Risk
- Efficiency
- Transparency
- Accessibility