You may buy shares occasionally and hold them for years, but your demat account can still have a recurring maintenance fee. Known as AMC, this charge is worth checking alongside brokerage when comparing account costs.
How much you pay depends on your account category and provider’s terms. You may qualify for reduced maintenance charges, a zero-AMC plan or a temporary waiver. Understanding the differences helps you work out the cost of keeping your account.
Table of Contents
What is AMC for a demat account?
AMC generally stands for Annual Maintenance Charge, although some providers call it Account Maintenance Charge. It is a recurring fee for maintaining your demat account, which holds securities electronically.
A depository participant, or DP, services your account. This may be a registered bank, broker or another eligible institution. Its tariff specifies the maintenance fee and billing arrangements.
Here, AMC refers to an account charge; it is different from an asset management company, which manages mutual funds.
How much are demat AMC charges in India?
Regular demat accounts do not all have the same maintenance fee. Charges vary by provider, account category and plan.
To compare demat maintenance charges, check:
- Annual cost: The total payable over a year, even when collected in instalments.
- Account category: Whether the tariff applies to your particular account.
- Waivers: How long free maintenance lasts and whether conditions apply.
- Taxes: Whether the displayed charge includes applicable taxes.
- Other fees: Charges for the transactions and services you expect to use.
Basic Services Demat Accounts, or BSDAs, have specific regulatory fee limits, explained below.
When and how is AMC charged?
The word “annual” does not mean the fee must be collected once a year. AMC may be billed monthly, quarterly, half-yearly or annually. Check when billing starts, whether payment is collected in advance and where the charge appears in your provider’s bill or account records. If you receive an introductory waiver, confirm when it ends.
Not trading does not automatically remove AMC. The fee relates to maintaining the account, so an unused account may still attract charges under its applicable terms.
AMC vs other account charges
Different charges cover different activities:
| Charge | What it covers |
| AMC | Maintaining the demat account |
| Brokerage | Executing trades through a broker |
| Demat debit or transaction charge | Processing applicable debits of securities |
| Dematerialisation or rematerialisation charge | Converting physical certificates into electronic holdings or reversing that process |
| Pledge-related charge | Processing applicable pledge or related instructions |
This helps explain why an account with zero maintenance charges can still have costs when you trade or request another service.
Source: National Securities Depository Limited (NSDL), FAQs on the depository system.
What is a Basic Services Demat Account?
A Basic Services Demat Account offers defined services with reduced maintenance charges for eligible individuals.
Under the Securities and Exchange Board of India’s, or SEBI’s, framework, eligibility requires:
- Only one demat account in which you are the sole or first holder.
- Only one BSDA in your name across all depositories.
- Combined debt and other securities holdings not exceeding ₹10 lakh at any point, calculated under the applicable valuation rules.
Current BSDA maintenance charges
If your account qualifies for BSDA, the value of your holdings determines the maximum annual maintenance charge you can be billed:
| Value of holdings for BSDA purposes | Maximum annual maintenance charge |
| Up to ₹4 lakh | Nil |
| Above ₹4 lakh and up to ₹10 lakh | ₹ 100 |
| Above ₹10 lakh | Not eligible for BSDA; regular-account AMC may apply |
Other services may still attract fees. DPs must not charge BSDA holders more than regular-account holders for those services.
Source: SEBI, Facility for Basic Services Demat Account, circular dated 28 June 2024.
How eligibility is reviewed
Rules effective from 31 March 2026 require DPs to reassess existing accounts’ BSDA eligibility every quarter. Eligible accounts must be opened or converted to BSDA unless the holder actively consents through an authenticated, verifiable channel to a regular account.
Suspended securities, delisted securities and Zero Coupon Zero Principal bonds are excluded when determining the eligibility value. Illiquid securities are valued using their last closing price.
Ask your DP to confirm your account classification if you believe it qualifies.
Source: SEBI, circular on enhancing the BSDA facility, dated 24 December 2025.
What does a zero-AMC demat account mean?
A zero-AMC account waives maintenance charges under the provider’s stated terms. Before choosing one, check:
- Duration: Whether the waiver is introductory or ongoing.
- Eligibility: Whether it depends on a particular plan or condition.
- Upfront cost: Whether a subscription or plan payment is required.
- Remaining charges: Which transaction and service fees still apply.
Nil AMC under BSDA is a regulatory benefit for eligible investors. A provider’s promotional waiver is a separate arrangement.
How to reduce demat annual maintenance charges
Start by reviewing the account you already have:
- Confirm BSDA eligibility: Check whether the correct account category and maintenance slab apply.
- Compare complete tariffs: Consider maintenance alongside the service fees relevant to your usage.
- Review unused accounts: Each account may carry its own charge, so consider formally closing accounts you no longer need.
- Check before opening another account: An additional account in which you are the sole or first holder can affect BSDA eligibility.
- Track waiver expiry: Find out what you will pay after an introductory offer ends.
- Review bills: Query charges that do not match your agreed tariff or account category.
Compare costs alongside service quality and the convenience of managing your holdings.
What happens if you do not pay demat AMC?
An unpaid charge can remain outstanding. Contact your DP to confirm the amount, billing period and any waiver that should apply.
Under CDSL’s rights and obligations document, a DP may stop processing an account holder’s instructions after giving two days’ notice for unpaid charges, until payment and any applicable interest are settled.
If you disagree with the bill, raise the issue with your DP and keep the tariff and account records available. Unresolved grievances can be taken through the applicable depository or SEBI complaint process.
Sources: Central Depository Services (India) Limited (CDSL), DP Operating Instructions, Annexure 2.7, June 2026; SEBI, Investor Charter.
Conclusion
Understanding AMC for a demat account helps you compare the cost of holding investments alongside trading costs. Check your demat AMC charges, BSDA eligibility and waiver conditions, then review the full tariff. Keeping the accounts you need and choosing terms that suit your usage can help you manage maintenance costs more effectively.
FAQs
Does free account opening mean there is no AMC?
No. Opening an account and maintaining it are separate services. Check the maintenance tariff and waiver period even when an account is advertised as free to open.
What does lifetime-free AMC mean?
It generally describes an ongoing maintenance-fee waiver under a provider’s plan. Read the written terms for eligibility, any upfront payment and the services covered, because other charges may still apply.
Can a DP increase maintenance charges?
A DP may increase its agreed charges after giving at least 30 days’ written notice. Review the revised tariff and effective date to decide whether the account still suits your needs.
Can I get an AMC refund when I close or move my account?
If AMC was collected upfront annually or half-yearly, the DP must refund the amount for the remaining unused quarters when you close the account or shift it to another DP. This requirement does not apply to AMC collected monthly or quarterly.
Are securities transfers free when I close my account?
Transfers made as part of account closure are free when the source and destination accounts have identical holder names and holding patterns. Other transfers may attract the applicable transaction fee. Any outstanding dues must also be addressed during closure.
Can AMC be waived when illiquid securities prevent closure?
CDSL provides for non-charging of AMC for specified accounts in “To be Closed” status that hold only illiquid, suspended or delisted securities. Ask your DP whether your account meets these conditions; leaving it unused alone does not establish eligibility.
