CDSL TPIN plays an important role in stock trading. It is a six digit password that is provided to authorize the broker to debit the selected stock from the Demat account with the CDSL for a period of up to 90 days. A TPIN acts as a PoA and hence can be rightly said to be its alternate.
What is CDSL TPIN?
The CDSL TPIN was introduced recently in 2020 in the month of June. It was alternate to the Power of Attorney (PoA) that is provided by the Demat Account holder to the broker. PoA is given to the broker; however, the CDSL customers are no more required to sign the PoA to trade online. Though, earlier it was a compulsion to sign the PoA.
The CDSL TPIN is directly issued by the CDSL to the customers. The customers are also given the facility to reset the pin online at any given point of time using an OTP received on their phone as per their convenience.
The TPIN is used for e-DSL verification for selling stocks. CDSL manages the list of authorized securities for a customer. Using a CDSL TPIN makes it safe for the investors as the brokers cannot temper with it legally at any step. The CDSL TPIN is used by all the stock brokers as the third party service in the trading softwares provided by them.
Why is CDSL TPIN Required?
Prior to the introduction of the CDSL TPIN, the brokers used to ask the investors and traders to sign a Power of Attorney or PoA at the time of the Demat and Trading Account Opening. The limited PoA authorized the stock brokers to debit the securities from the investors’ Demat Account when the investor sold them.
The certain cases, it was found that the brokers misused the PoA for their own benefit. These illegal practices included:
- Withdrawing of the securities even when they were not sold by the customers.
- Moving of the shares to and from the customer demat account to the broker’s pool account without the consent of the customers.
- Using of the PoA scared the customers to pay the credit to the stock broker from the trading losses.
The Depositories tried their best to handle the misuse of the PoA by the stock brokers for their own benefit by sending regular emails and SMS alerts for each and every demat transaction that took place. However, the continuous measures taken by the Depositories failed to safeguard the investors’ interest.
Hence, on June 1, 2020 CDSL introduced the CDSL TPIN facility. CDSL TPIN is an additional password that allows the customers to authorize the demat transactions that take place from the investors account.
How to Use CDSL TPIN?
The CDSL TPIN is used by the customers to authorize the sale of shares that take place from their account. Here are the steps that the customers can follow to use their CDSL TPIN:
- Visit the stocks Dashboard on your stock broker’s website or mobile application and select the stock that you wish to sell.
- Click on the ‘Verify Sale’ Option in order to place the sale of the selected share.
- Look and click on the ‘Verify using TPIN’ option or you can also request for a new TPIN. In case you request for a new TPIN then it will take 6 minutes for the TPIN to get activated.
- The user is directed to the CDSL page where he/she is required to enter the TPIN and then verify the same. The customer has received the TPIN either on email or through an SMS.
- Once the TPIN is verified then the user is redirected to the other page on the broker’s website or mobile app where the sale order can be completed.
How to generate the CDSL TPIN?
In case the customer has not received the CDSL TPIN, he or she can create one for themselves. In order to generate the CDSL TPIN, you can follow the steps mentioned below:
- Click on the link https://edis.cdslindia.com/home/generatepin
- Enter the BO Id that is the Demat Account Number held by you and your PAN Card Number.
- In order to get your Demat Account Number login to your brokers mobile app or trading terminal.
- Once the details are entered CDSL will send you an OTP on the registered mobile number ( the number that is linked to your Demat Account).
- Enter the OTP in the required space.
- Once you enter the OTP CDSL will sent you your TPIN either via an email or through an SMS on your registered email id and mobile number.
Benefits of CDSL TPIN
The CDSL TPIN that has been recently introduced offers the following benefits to the Demat Account users:
- It makes the Demat Account transactions safer and secure by eliminating the need for signing the PoA with the stock broker for the Demat Account.
- TPIN provides better control over the authorizing of the transactions that take place through the Demat Account.
- CDSL TPIN is required for each and every Demat withdrawal transaction that takes place through your account especially if you have not signed a PoA with your stock broker.
- The TPIN is managed by the CDSL itself which means that it is absolutely impossible for the stock broker to misuse or manipulate it as per their convenience.
- With the CDSL TPIN the entire process of opening the demat account becomes completely paperless. Earlier the need of signing the PoA made it a paper process as the PoA could only be signed and filled in the paper form.
How to reset CDSL TPIN?
The CDSL TPIN can be changed or reset online by the customer for increasing the safety and security of the Demat Account transactions taking place from his/her account.
The process of changing the CDSL TPIN is just like generating a new TPIN.
You can follow the below steps:
- Visit the cdslindia.com website.
- Click on the change eDIS TPIN link which is available on the right side.
- Enter the 16 digit BO ID which is your Demat Account Number.
- Enter the PAN Card Number and click on the ‘Next’ button.
- Enter the OTP received on the registered mobile number.
- Receive the new or changed TPIN in SMS and email.