How to Close Your Father's Demat Account With Yes Bank Shares under Lock-In: A Comprehensive Guide

Introduction: A demat account with Yes Bank shares under lock-in is a specific scenario that requires careful attention. If your father has recently passed away, here is a detailed guide on how to proceed with closing his demat account, especially considering the lock-in period. This guide aims to provide clarity and step-by-step instructions to help you manage the situation effectively.

1. Understanding the Nominee in Your Father's Demat Account

One of the first steps is to identify whether there is a nominee listed in your father's demat account details. A nominee is a person who has been appointed as the rightful receiver of the shares in case of the account holder's death. If you are named as the nominee, it is essential to proceed with opening a new demat account in your own name and getting the shares transferred to your account. This process can be simplified if you already have a demat account with Yes Bank, as it can be done in a more straightforward and timely manner.

2. No Nominee: Bank Procedures and Block Management

In case there is no nominee named in your father's demat account, the bank will guide you through the necessary procedures. One common requirement is to fill out a bond and affidavit. These documents ensure the legitimacy of the transaction and comply with regulatory requirements. It is crucial to follow bank instructions carefully and accurately, as overlooking or misplacing these documents can delay the process. Banks often recommend keeping the demat account open until the lock-in period is completed.

During this period, you should keep the shares under lock-in and manage any exit positions by transferring funds to your account. This process might involve additional steps and paperwork, such as ensuring that no shares are sold during the lock-in period, which could breach the terms and conditions of the account.

3. Utilizing Your Broker’s Services

Considering the potential difficulties and uncertainties, it might be beneficial to consult your broker for guidance. Service providers such as Zerodha offer facilities to gift stocks to family members, which can be an efficient and effective solution if available. Your broker can also assist in transferring your father's shares to your demat account, provided they have the necessary facilities to facilitate such transfers.

4. Understanding the Lock-In Period and Share Transfer

The lock-in period generally lasts for 3 years, from the date of the transaction (13th March 2020) until 12th March 2023. During this period, shares are typically restricted from being sold, except under specific conditions as defined by the relevant regulatory bodies. Therefore, if you cannot close the demat account immediately, it is important to let the share remain under lock-in until the restrictions are lifted.

In the event that a transfer to a nominee is required, this ensures continuity of control over the shares while maintaining the necessary restrictions according to the lock-in period. However, it is crucial to understand that you may still have to follow the lock-in rules after the transfer.

Conclusion

Managing a demat account with Yes Bank shares under a lock-in period after your father's passing involves several steps and considerations. Understanding the role of the nominee, following bank procedures, and consulting your broker for specific advice can help streamline the process. Whether you are a nominee or not, it is important to act according to the instructions provided by the bank to ensure compliance and effective management of the situation.

Keywords: Demat Account, Lock-In Period, Yes Bank Shares, Nominee, Transfer Shares