A demat account, short for dematerialised account, stores your shares, bonds, ETFs and mutual fund units electronically, the way a bank account stores money. It is held with one of India's two depositories, NSDL or CDSL, through a depository participant (DP), which is usually your broker. You need a demat account to hold delivery shares; an intraday trader technically needs only a trading account, but brokers open both together. Opening requires KYC: PAN, Aadhaar, bank proof and a signature. When you buy 10 shares of SBI for delivery, they appear in your demat holdings after T+1 settlement. When you sell, they leave. DP charges apply on each sell transaction, and some DPs charge an annual maintenance fee. Check both before choosing. Keep the login and the linked email secure, since the account holds your investments.