If one wants to invest in securities, one must open a demat account. The demat accounts allow you to trade in securities online and also keep securities in dematerialised and digitalised form. That helps protect securities from physical loss as might otherwise occur due to the destruction of physical certificates or documents or their theft. So, it is safer to open demat account. However, you must still protect your demat account from fraud or cyber threats. The following are some of the most helpful tips for doing this:
- Choose Depository Participant carefully.
You must carefully choose the Depository Participant (DP) carefully. Only go for a DP that is registered with the SEBI or Securities and Exchange Board of India, the regulatory authority responsible for overlooking the interests of shareholders. Apart from that, go for a reputable DP after checking their customer reviews.
- Maintain Secure Login Credentials
Insecure login conditionals are the biggest vulnerability that most commonly exposes demat accounts to cybersecurity threats. Thus, it would be best if you used a strong and unique password for the demat account by involving letters, numbers, special characters, etc. It would be best if you avoided any guessable or easily accessible information for passwords like your own or one of your loved ones’ names, phone numbers, birthdates, phone numbers, etc. Further, it would be best if you changed your password frequently and, of course, did not share them with anyone whatsoever.
- Use Two-Factor Authentication
You should activate and use two-factor authentication (2FA). This adds a second layer of security for your accounts as it will send a one-time password or OTP to your registered phone number, and you or anyone else will need to enter this password to access the account. Since that requires access to your phone along with the password, it makes your account secure.
- Use secure devices
The devices you access your demat account on should also be secure. They should be up-to-date with the latest security patches, as older operating systems may suffer from known security threats and vulnerabilities. Further antiviruses can be used to provide an additional layer of security.
- Use secure Wi-Fi connections.
Wi-Fi connection is another possible security threat. You must avoid using public Wi-Fi for accessing your demat account or for conducting financial transactions, and only secure and trusted Wi-Fi connections should be used for the purpose.
- Keep contact information updated.
You must always keep your contact information updated, especially email and phone numbers, as they are often required for accessing your account.
- Other tips
The following are some of the other tips to remember:
- Monitory your account and investments regularly.
- Don’t share personal details, accounts or information over phone calls or emails, particularly account numbers, passwords, or OTP.
- Any legitimate institution never asks for sensitive details, but some malicious elements may make phishing attempts by pretending to represent such legitimate institutions.
- Continuously educate yourself about the latest financial security practices. Check the guidelines of SEBI every few months for this purpose.
- Contact concerned authorities in case of suspicious authorities.
The bottom line
Following these tips shall help you protect your demat from fraud and let you do your stock trading in peace.