The policy for a Dormant account has been framed out under the specific guidelines of Prevention of Money Laundering Act (PMLA) for the safety and security of the investors as well as the financial market.
The Dormant Account Policy lays down the procedure to be followed when an instruction for debit/credit or buy/sell is received from an account which is Dormant. This policy gives full description like the time period and method considered for terming an account Dormant and also various steps required to be adhered to strictly for re-activating such Dormant accounts.
An account shall be termed to be Dormant if it is inactive or remains non-operational by its holder at a stretch for a specified period of time. This specific period of time has been defined under the PMLA. Presently, this period is 365 days for both Trading and Demat Account i.e. if an account is inactive for a minimum period of 365 days for Trading and Demat Account, it will be classified as a dormant account.
All Dormant accounts will be treated in accordance to the policies prescribed under the PMLA. Accordingly the dormant account will be freezed immediately and the client will not be permitted to undertake any further transaction in such dormant account. The procedure for listing of dormant account is run once every month.
A Dormant account shall be re-activated and further trading by such client should be allowed only after undertaking sufficient due diligence (including IPV) and obtaining the updated information related to KYC from the concerned Client.
The above stated policy may be modified at any time in accordance to the various rules, regulations, bye- laws and guidelines that may be prescribed by SEBI, Exchange or any other competent authority or as per the internal policy of the organization from time to time. This policy for dormant account is over and above the transaction monitoring in dormant account as per the Anti-Money laundering policy of the organization.